Media support of beer duty campaign is reason for optimism

By John harrington

- Last updated on GMT

Related tags: Duty hikes, Duty escalator, Beer, Democracy, Brewing

Harrington: "It’s tempting to think so, but the reality is that the political and economic dimensions around the pasty tax and the beer-duty escalator are very different"
Harrington: "It’s tempting to think so, but the reality is that the political and economic dimensions around the pasty tax and the beer-duty escalator are very different"
At times, campaigning against the beer-duty escalator has felt like pushing a beer keg uphill. Politicians and the national media have long paid lip service to the importance of pubs and breweries and the impact of taxes, but in truth there’s been little significant support for ending the 2%-above-inflation hikes introduced in 2008. And the Treasury hasn’t moved an inch.

But the events surrounding last week’s debate on beer tax in Parliament could go down in history as a breakthrough, of sorts. Not for the hearts and minds of the well-meaning MPs in attendance, who have been well lobbied on the affect duty hikes are having on businesses in their constituencies.

And also not yet at the Treasury. Treasury Minister Sajid Javid’s response to the debate was vague and predictable. “This Government recognises the importance of pubs and breweries,” he said. “I think it has been a very valuable debate... and I will take away a lot of messages and make sure the Government does more to help the industry.”

Could that help include a full investigation into the impact of the duty escalator? There’s been no word on that, let alone any indication of a change of heart at Number 11 about the escalator itself.

The real breakthrough was in how the media handled the issue. Newspapers gave seemingly unprecedented coverage to the impact that duty hikes have had on the industry. Most pleasingly, The Sun was unequivocal in its support for the campaign.

The newspaper said: “If the PM really wants to win favour with voters, he must tell George Osborne to stop treating the traditional after-work beer as a convenient cash cow. And call time on this punitive booze tax.”

The Sun said rising duty has been “the same sort of kick in the teeth for hard-up Brits as the disastrous pasty tax”. The red-top famously backed the campaign earlier this year to reverse the decision to add
VAT to hot takeaway food. So with some high-profile new backing, could the crippling duty hikes be going the same way?

It’s tempting to think so, but the reality is that the political and economic dimensions around the pasty tax and the beer-duty escalator are very different.

Had it gone through, 20% VAT added to hot baked goods would have been a bolt in the head for producers and retailers of pasties, hot pies and so on, threatening businesses and jobs almost overnight. In contrast, the duty escalator has been a long, painful turning of the screw for the beer and pub industry.

And unlike VAT on pasties, Labour has been unwilling to throw its weight squarely behind opposition to the duty escalator — not least because it was a Labour Government that introduced it.

So where does this leave the beer tax campaign? The Government is not compelled to do anything as a result of the vote in Parliament, even after MPs voted unanimously for an inquiry into the escalator.

There’s still a lot of work to be done, but if the Government doesn’t make concessions in next year’s Budget, it’s likely some sections of the media will be waiting to pounce.

The industry may face an uphill struggle over beer tax, but perhaps now it has an extra Fleet-Street-backed spring in its step.

Related topics: Beer

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