Treasury confirms it has 'no plans' for beer duty escalator review

09-Nov-2012 - Last updated on 08-Nov-2012 at 08:19 GMT

Beer escalator: The tax has risen 42% since it was introduced Image: Molson Coors

The Treasury has confirmed that it has no plans to review the beer-duty escalator just days after a debate in the House of Commons saw MPs vote unanimously for a reassessment.

Some 20 MPs spoke in favour of pubs and beer during the three-hour session. It followed an e-petition on the topic that exceeded 100,000 signatures.

However, a Treasury spokesman told the Publican’s Morning Advertiser: “There are no current plans for a review of the beer-duty escalator but we do keep all taxes under review. We will continue to engage with the alcohol industry, including pubs and breweries, on how the tax is affecting them.”

The British Beer & Pub Association (BBPA), Campaign for Real Ale (CAMRA) and the Society for Independent Brewers (SIBA) are to send a joint letter to Treasury Minister Sajid Javid increasing the pressure on him to conduct a review.

CAMRA is also planning a Parliamentary mass rally on 12 December.

The escalator has seen a 42% rise in beer duty since it was introduced in 2008.

During the debate, many MPs said that if the tax keeps rising, the Government will no longer benefit from it. Others explained that the industry is helping keep millions of people employed.

They also pointed out that pubs are at a disadvantage when it comes to beer sales in supermarkets, accusing the giants of driving down prices, using alcohol as a “loss leader”.

Greg Mulholland MP, chair of the All-Party Parliamentary Save the Pub Group, called for Javid to consider a “progressive tax that will help the British pub and brewing industries”.

Javid concluded the debate by saying that he will take away the messages from the trade and “make sure the Government does even more to help the pubs and brewing industry”.

He added that it is not only the escalator that is having a negative impact on pubs. Issues such as consumer behaviour have also affected the trade.

SIBA chief executive Julian Grocock said: “I would have liked the Treasury to have responded more positively to a unanimous call to review the beer-duty escalator.

“We were encouraged by the debate and the outcome, but we will now look to the Treasury to take due notice.”

A BBPA spokesman added: “We are very disappointed that the Treasury has ignored the views of Parliament, the 100,000 signatories to the e-petition and the entire beer and pub supply chain in not granting an instant review.

“We will be writing to the Treasury Minister urgently to ask him to reconsider this decision. We are convinced a review will show the escalator is bad for breweries, pubs and beer drinkers, and also damaging to UK plc.”