Anti-duty lobbyists meet Treasury minister to crank up campaign

By Helen Gilbert

- Last updated on GMT

Related tags: Duty escalator, Tax

WSTA chief Miles Beale: 'Scrapping the duty escalator would provide a significant boost for struggling pubs'
WSTA chief Miles Beale: 'Scrapping the duty escalator would provide a significant boost for struggling pubs'
Campaigners calling for the Alcohol Duty Escalator (ADE) to be scrapped met with the economic secretary to the Treasury last week to ramp up their crusade.

The Wine & Spirit Trade Association, the Scotch Whisky Association and the Taxpayers’ Alliance discussed the Call Time on Duty campaign with minister Nicky Morgan and explained how the removal of the ‘alcohol supertax’ in the budget on 19 March would provide an important boost for struggling pubs.

The coalition argues that the escalator, which will increase duty on wine and spirits by inflation plus an additional 2%, would create less revenue for the Government than if it were dropped and has written to the Chancellor outlining five reasons why the controversial ADE should be torn up.

Boost to economy and jobs

It follows economic research by Ernst & Young, commissioned on behalf of the campaign group, which found that the removal of the escalator would lead to a £1bn boost to the economy, create at least 6,000 additional jobs, and increase public finances by £230m in 2014, rising to £265m in 2018.

The findings also suggested that the incentive for alcohol fraud — currently estimated by HMRC as costing £1bn a year — would be lowered, while hard pressed UK consumers would be provided some relief.

Impact of the duty escalator

“The minister was keen to understand how the sector is performing and how the Government can support the industry,” WSTA chief executive Miles Beale said.

“We spoke about the impact of the duty escalator, which has increased tax on wine by 50% and spirits by 44% since its introduction in 2008... given the growing contribution of wine and spirits to pubs — especially new ones — and the wider hospitality sector, scrapping the duty escalator would provide a significant boost for struggling pubs.” 

 Most 'bang for his buck'

Brigid Simmonds, chief executive of the British Beer & Pub Association said: “We’d welcome any tax cuts that would help pubs get their tax bills down.

“But if the Chancellor wants the most ‘bang for his buck’, a freeze in beer duty should be the top priority, as it delivers the greatest possible support to pubs and secures vital jobs. This is because beer sales account for 66% of pub sales, compared to wine (12%) and spirits (13%).”

Related topics: Legislation

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