Fury over Budget booze blitz

Pubs chiefs and licensees have blasted the government after the worst Budget for the industry in living memory.

Chancellor Alistair Darling slapped an across the board inflation-busting six per cent hike on alcohol taxes in his first Budget yesterday.

Duty on beer is up 4p a pint, wine by 14p a bottle and cider by 3p a litre. A 10-year freeze on duty on spirits was ended with a 55p per bottle hike and tax on 20 cigarettes was raised by 11p a packet.

Darling added to the trade gloom by announcing alcohol taxes would rise by two percentage points above inflation for the next four years.

The Campaign for Real Ale (CAMRA) said the move means the price of a pint will shoot up by 20p, while the British Beer & Pub Association (BBPA) said a pint would hit £6.50 by 2012.

Trade leaders rounded on the Chancellor, who said the tax rises on alcohol would help combat child poverty.

Rob Hayward, the BBPA's chief executive, said the Chancellor was "shooting himself in the foot".

"Treasury revenues will continue to fall, pubs will continue to close and beer sales sink further," he said. "The government is punishing all beer drinkers rather than tackling the minority of drunken hooligans." He argued it would drive people "out of the pub into the arms of the deep-discounting supermarkets".

The tax hikes would also open the floodgates to booze cruises and bootleggers, Hayward added.

The rises are a severe blow to the industry after an intense lobbying effort, while many licensees are struggling to cope with spiralling costs, sinking sales, fragile consumer confidence and the smoking ban.

Jonathan Neame, chief executive of pubco Shepherd Neame, who led the BBPA's panel on duty, blamed the failure on a "juggernaut of prejudice".

CAMRA chief executive Mike Benner said: "It's a great big nail whacked ruthlessly into the coffin of the British pub."

Fallout

Licensees meanwhile were bracing themselves for the fallout.

David Dudley, licensee of the George at Great Oxendon, Leicestershire, said he would be "very unpopular" with customers when he has to put his prices up.

"It's very unfair, because the supermarkets will just absorb the rise and continue to sell alcohol below cost," he added.

Comments from other concerned Publican readers flooded our website as details of the Budget emerged.

David Hall, chairman of newly formed union Licensees Unite, said: "This is truly a stab in the back for many publicans and their families."

Unsurprisingly, doctors welcomed the increases. Dr Vivienne Nathanson, head of science and ethics at the BMA, said: "These tax increases may be unpopular with some members of the public, but we hope that they will look at the wider issue and recognise that the UK has a real problem on its hands regarding alcohol misuse."

The Budget: at a glance

• Beer up 4p a pint
• Wine up 14p a bottle
• Spirits up 55p a bottle
• Cider up 3p a litre
• Duties on alcohol will rise by two per cent above inflation in each of the next four years
• Cigarettes up 11p a packet of 20, five cigars up 4p
• Ninety per cent of small businesses will continue to pay Capital Gains Tax of 10 per cent after concessions confirmed over new rate
• All new non-domestic buildings to be zero-carbon by 2019