Alcohol duty freeze extended by six months

The government has confirmed that the alcohol duty freeze has been extended by a further six months to 1 August 2023.

Speaking in the House of Commons yesterday, treasury minister James Cartlidge announced that, while new duty rates typically come in each year on 1 February, chancellor Jeremy Hunt will instead make his decision on future duty rates at the spring budget "to give businesses certainty and time to prepare".

He confirmed that if changes to duty are announced then, they will not take effect until 1 August 2023.

Cartlidge said: "We fully understand that businesses face difficulty and uncertainty in the face of rising energy bills and inflation… By saying to the industry that they will face just one single industry-wide change next summer, rather than two or more over the course of the year, we are giving maximum certainty to industry. Hospitality is a major part of the economy, and while these remain challenging times, we are doing everything we can to support individual hospitality businesses of every size so that they can have a prosperous new year."

Emma McClarkin, chief executive of the British Beer and Pub Association (BBPA), said: "The decision to extend the freeze on beer duty will be welcomed by pubs and brewers alike. In 2022 our industry has faced pressures and challenges like never before. This freeze will allow £180m to be reinvested into our sector at a critical moment and inject a much-needed flurry of festive cheer for pubs and breweries. It shows the Government understands just how much our pubs and brewers mean to communities across the UK.

"Investment in our sector now will pay dividends in villages, towns and cities across the country for generations to come. Pubs and brewers are a crucial thread in the social fabric of our society and contribute not only economically but socially, connecting people in communities up and down the country.

"We look forward to working with the Government to implement the promised duty reforms in 2023 ensuring a fair and modernised rates system in the UK that support lower-strength products and our country's pubs."

Nick Mackenzie, chief executive of pub group Greene King, added: "The Chancellor's decision to extend the freeze on alcohol duty is great news for the industry and recognises the vital role that pubs play at the heart of communities.

"This announcement is welcome and will do much to support our pubs and tenants through a challenging winter as the sector continues to face severe cost pressures. However, we urge the Government to keep its promise to modernise the alcohol duty system so it is fairer for pubs and supports lower-strength products. Fundamental reform is long overdue and will open up investment in the sector, enabling pubs to continue to support communities up and down the country."

The then chancellor, now prime minister, Rishi Sunak announced alcohol duty reform in his budget last year, with plans to create a system that is "simpler, fairer and healthier".