Trade groups warn against excise hike

Trade groups have pleaded with the Government not to increase excise duty as a means of controlling binge drinking and alcohol abuse.

Four associations representing a range of drinks producers claim tax hikes are the wrong solution to the problem and will merely penalise the majority of people who drink sensibly.

An open letter to the Trea-sury from British Beer & Pub Association (BBPA) chief executive Rob Hayward claimed extra duty would fail to tackle the binge-drinking issue.

Hayward said trade associations were concerned that calls for significant increases in excise duty would not have the desired effect on alcohol abuse problems. He refered to comments made last May by former financial secretary John Healey MP, who ruled out tax increases as a way of dealing with social problems caused by alcohol misuse.

"We fully support the need to educate young people about the damaging effects of alcohol misuse and are committed to playing our part in this process," the letter states.

"We recognise the role that we (the trade) have to play in promoting responsible drinking and working with the Government and other stakeholders in tackling alcohol misuse."

Hayward pointed out that the UK already applied some of the EU's highest duty rates and said changes in taxation should be made for economic reasons, given that those who misuse alcohol will find mon-ey to purchase drink to the detriment of other spending.

"It (a duty increase) would encourage a return to illicit activity and should be seen against the reality of a declining market for alcoholic drinks, a position that would be exacerbated further by increased duty," he added.

Other trade groups that are signatories to the letter are the Gin & Vodka Association, National Association of Cider Makers, the Scotch Whisky Association and the Wine & Spirit Trade Association.

The letter has been sent to Chancellor Alistair Darling, treasury ministers and other Government officials.