Government losing millions in beer tax payments despite hikes in duty

29 October 2009 by
Government losing millions in beer tax payments despite hikes in duty

The Government received £174m less beer tax in the first nine months of 2009, compared to the same period last year, despite huge hikes in the duty that were designed to bring in more revenue, research reveals today.

The latest UK Quarterly Beer Barometer, published by the British Beer & Pub Association (BBPA), reveals that 4.3 million fewer pints were drunk each week during July, August and September, a 4.7% fall on the same period in 2008.

Nevertheless, the figures for the quarter show that sales of beer are beginning to stabilise, with the 4.7% drop the second lowest rate of decline since the first quarter of 2007.

Brigid Simmonds, BBPA chief executive, urged the Government to hasten this recovery by cancelling the 8% beer tax hike when VAT returns to 17.5% in January.

"These latest figures signal that overall beer sales are beginning to stabilise, but beer sales in pubs continue to decline," she said. "This is a fragile situation, that could well be jeopardised by the wrong decisions on tax in the forthcoming Pre-Budget Report.

"Government should announce that when VAT goes back up in January, it will cut the 8% tax increase it put on beer in the Pre-Budget Report last year, which coincided with the VAT decrease. This would be revenue neutral for Government and a boost to beleaguered pubs."

Decline in pub beer sales shows signs of ‘stabilising' >>

Alcohol consumption falls by fastest rate in 60 years >>

BBPA defends its new code of practice for pubcos >>

Greene King to quit British Beer & Pub Association >>

By Daniel Thomas

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