Industry finds Brown's Budget hard to swallow

Brewers and drinkers have slammed Gordon Brown's decision to slap a 1p duty hike on beer.

Both the British Beer & Pub Association (BBPA) and the Campaign for Real Ale (CAMRA) have spoken out against the increase, announced in yesterday's Budget.

Other measures to affect the trade included a 4p rise on a bottle of wine and a duty freeze for spirits, cider and champagne.

Mark Hastings, the BBPA's communications director, said it was disappointing Chancellor Gordon Brown continued to choose a tax strategy which "favours imported Australian chardonnay over home-produced British beer".

"In recent years, there has been a surge in wine drinking and the strength of wine we drink. Yet while stronger beer is taxed more than weaker beer, stronger wine is taxed the same as weaker wine," he said.

CAMRA had also been pressing for a freeze, or even a drop, in beer duty to tackle the price differential between UK beer and foreign imports.

"A tax rise is a flawed strategy which will cost jobs, increase smuggling and uncontrolled drinking and leave responsible beer drinkers out of pocket," said CAMRA chief executive Mike Benner.

"Some pubs will now be charging as much as 10 pence a pint more than they were only a month ago."

Mr Benner criticised Coors and Carlsberg for sending the wrong message to the Chancellor by increasing beer prices only last month.

Nick Bish, chief executive at the Association of Licensed Multiple Retailers, also raised concerns over bootlegging.

"It sends out all the wrong messages to those involved in alcohol smuggling," he said. "Every penny on a pint is a penny in the pocket of smugglers."

Mike Maloney, head of brewing at KPMG, noted that the Budget did not offer any further incentives for small brewers.

He added: "This Budget will do nothing in reversing the decline in sales of home-produced beer."

Other key Budget points:​

• a 7p a packet rise on cigarettes
• a series of measures against tax avoidance, action against capital gains tax and VAT avoidance
• an extra £3.5bn put towards law and order
• reforms to reduce red tape for business
• a reduction in the number of bodies responsible for food safety.

For further details, visit www.hm-treasury.gov.uk/budget​

Will you raise the price of a pint?​

• Rick Robinson, licensee at the Willoughby Arms, Kingston Upon Thames, Surrey, said:​ "A penny on a pint is a pain for publicans. What am I supposed to do? I can't put my prices up any more."

Rose McCann, licensee at the Bull, Birmingham, said:​ "I don't think I'll be able to put up my prices - I just can't pass it on to my customers again after the recent increases. But it doesn't surprise me - publicans get it in the neck all the time and have to bear the brunt of duty rises."

John Pascoe, licensee at the Swan, Little Totham, Essex, said:​ "We'd already prepared ourselves for the rise. I would never swallow a rise even if it's only a penny, because with a busy pub, that's a lot of pennies."

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Related articles:​

Budget latest: A penny on a pint (16 March 2005)

Budget latest: Duty hike slammed (16 March 2005)