British beer drinkers pay 40% of European Beer Tax bill

22 September 2011 by
British beer drinkers pay 40% of European Beer Tax bill

Britain's beer drinkers are footing 40% of the entire European beer tax bill according to a new report, which the British Beer & Pub Associations (BBPA) said adds weight to calls for a rethink on tax hikes planned for the next UK Budget.

While Britain has only 12% of the EU population and 13% of total beer consumption, the UK Beer Tax bill has now reached £3.2b a year - more than five times as much tax as the total paid by German beer drinkers, who drink twice as much beer as the Brits.

BBPA chief executive Brigid Simmonds commented: "This new report shows the astonishing scale of the tax burden that the UK government is putting on our brewing industry, which remains one of the most important in Europe.

"With 40% of all European beer taxes collected in Britain, the figures point starkly at the key cause of the thousands of pubs and many breweries that have closed in Britain in recent years.

"And yet our sector has so much potential to create vital jobs in the hospitality industry. The UK treasury must take a very close look at these findings, and call a halt to further tax hikes."

The report by accountancy firm Ernst & Young, commissioned by the European brewing industry, also found attempts by 15 EU countries to balance their books in recent years by raising beer taxes has not resulted in increased revenue.

It said that European consumers have switched to cheaper supermarket deals instead, pushing pub and hospitality industry workers out of work.

The UK remains a leader in the brewing sector, boasting the second highest number of breweries in Europe's £106b beer market, topped only by Germany.

Britain's pubs account for a higher proportion of on-trade beer sales in Britain than on the continent - 51% of British beer is consumed in pubs, bars, hotels and restaurants, as opposed to 37% in Europe.

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By Janie Stamford

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