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Mixed reaction to beer duty cut
GEORGE OSBORNE may have brought cheer to the pub trade by announcing a cut in beer duty, but drinkers have been warned not to expect substantial savings.
The chancellor also axed the controversial duty escalator, blamed for hundreds of pub closures, in Wednesday’s (March 20) budget speech.
The scrapping of the escalator, which has seen the price of a pint increase by two per cent since 2008, will prevent a 3p rise in overall alcohol duty, with the extra 1p cut in tax on beer due to take effect on Sunday evening.
Paul Theakston, chairman of Black Sheep Brewery, in Masham, North Yorkshire, welcomed the changes, saying the chancellor had recognised beer as Britain’s national drink.
Malcolm McKee, landlord of the Pennyweight pub, in Darlington, said consumers will see beer prices hold at their current level when many may have been expecting them to go up.
He said: “I don’t think [the cut in duty] will have any impact on the business. We absorbed the beer price increase from our brewery while waiting for the budget.
“We will just have to look at our margins and see what we can do. It won’t necessarily be passed on [to customers], we’ve already been faced with an increase in February, so one will compensate for the other.
“But certainly we’ll hold price, when everybody will have been expecting them to go up.”
Mr Theakston described the cut in beer duty as a “very pleasant surprise”.
He said: “The previous Government had committed this Government to a two per cent above inflation rise, on top of any duty increase.
“That escalation has now been cancelled, which is very good news for pubs and beer drinkers alike.
“What was really unexpected was the 1p reduction in duty, it is a long time since there has been any sort of reduction in beer duty.
“Anything that brings the price of beer down, thereby encouraging people to drink it, has to be a good thing.
“Of course it will give our business much-needed help as well.
“The chancellor seems to have recognised beer as the national drink, ahead of the spirits, wines and ciders of this world.”
Balance, the North-East group which aims to change attitudes to alcohol in the region, said the measures would do little to reduce the impact of alcohol abuse.
Director Colin Shevills said: “We welcome the Government’s commitment to look at plans to tackle cheap, harmful alcohol.
“However, the measures announced will not impact on the harm that we’re seeing in families and communities across the North East.”
Balance urged the Government to revisit plans to introduce a minimum alcohol unit price, a move it says would save lives, reduce hospital admissions and cut crime.
Meanwhile, the British Medical Association accused the Government of sending “mixed messages” about its commitment to tackling the harm caused by alcohol misuse.