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SIBA warns high taxation is unfair to brewers, pubs and drinkers

09 March 2012 by
SIBA warns high taxation is unfair to brewers, pubs and drinkers

The current regime of alcohol taxation is unfair to brewers, pubs and drinkers.

That was the message from Keith Bott, chairman of the Society of Independent Brewers Association (SIBA), who called for policy-makers to "give beer a break" at yesterday's SIBA annual conference in Stratford-upon-Avon.

He said: "SIBA is fully committed to pragmatic reform of alcohol duties. We are happy to pay our fair share, but not the unfair share we are currently required to contribute."

He continued: "Punishing beer duty levels are clearly responsible for the societal changes that have taken place in the 32 years since SIBA was formed. The alcohol we drink and the way in which we drink it have been reshaped by successive Governments' taxation policies. Beer volumes have fallen while spirits, wine and cider are all in growth, thanks to a system which puts them at an advantage, and brewers - and the pubs that sell beer - at a damaging disadvantage."

While beer duty has increased by 35% over the past five years, spirits enjoyed a duty freeze for a decade from 1998. Wine duty, though linked to beer, has a banded structure that has allowed producers to increase abv up to 15% with no additional tax liability.

Bott said: "The Government seems intent on driving consumers away from beer to drinks with a higher alcohol content, which seems at odds with its policies around alcohol-related harm."

Turning to cider duty, Bott said that currently the largest global cider producers paid less duty than the smallest UK microbrewer receiving the maximum amount of Small Breweries' Relief (SBR). Cider duty is less than half that of beer, and has the additional advantage of banding. Bott added: "The disparity between beer and cider duties is nothing less than an invitation to large drinks producers to swap their consumers from one fermented beverage to another."

"Alcohol taxation iniquities are not just encouraging people to switch from beer to other drinks, they are also driving drinkers out of the pub - the only place where alcohol consumption is supervised. The Government's policies have been putting at risk the health of the nation.

"After much campaigning, on which SIBA has aligned with the BBPA, Camra and others, many politicians and health campaigners now recognise that beer, a low-alcohol drink, consumed in the socially responsible environment of the pub, should be seen as part of the solution to alcohol-related harm - not the problem. The trouble is that, while our arguments are beginning to hit home, we are not getting the results we need now in order to avoid further damage to our industry.

"SIBA's Budget submission this year presented what we believe to be a very credible proposal to extend SBR to brewers producing up to 200,000 hectolitres annually. Crucially, we demonstrated how funding for this extension could be achieved simply by pegging the difference between beer and cider duties at its current level, rather than applying across the board percentage increases which would further increase the gap and gift another windfall to cider."

SBR, introduced in 2002, has helped small, local brewers thrive, with SIBA membership growing from 235 to 550 brewers.

Turning to minimum pricing, Bott reminded the audience that SIBA had been the first trade body to cautiously welcome the idea, as a way of closing the on-off trade price gap.

Hospitality urges MPs to support motion calling for beer duty freeze >>

SIBA warns thriving brewers threatened by Government's beer taxation policy

By Neil Gerrard

E-mail your comments to Neil Gerrard here.

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