Britain helps pubs by raising 'draught relief' on beer
LONDON (Reuters) -Britain's finance minister Jeremy Hunt offered some help to pubs on Wednesday by increasing "draught relief", making the rate of duty on draught beer and cider up to 11 pence lower than the charge on cans or bottles bought in a supermarket from August.
The measure will coincide with a rise in alcohol taxes in line with inflation, ending a freeze that has been in since 2020, and will result in no change in the duty paid on a typical pint poured from a tap in a pub, the government said.
"In December, I extended the alcohol duty freeze until August 1st, after which duties will go up in line with inflation in the usual way," Hunt told parliament in his budget statement.
"But today, I will do something that was not possible when we were in the EU and significantly increase the generosity of Draught Relief, so that from August 1st the duty on draught products in pubs will be up to 11p lower than the duty in supermarkets, a differential we will maintain as part of a new Brexit pubs guarantee."
The government is also pressing ahead with reforms that will increase taxes on stronger alcoholic products, such as wines and spirits.
JD Wetherspoon's chairman Tim Martin said any reduction in the tax disparity between pubs and supermarkets was welcome.
"This gesture by the government is a tacit acknowledgment that something needs to be done," he said.
Diageo, the maker of Johnnie Walker Scotch whisky, said the alcohol duty rises would be a "hammer blow for pubs, drinkers and for Scotch, a homegrown industry supporting tens of thousands of jobs".
"We urge the chancellor to reverse this punitive and inflationary tax hike," said Diageo GB Managing Director Nuno Teles.
(Reporting by David Milliken, Radhika Anilkumar and Richa Naidu, Writing by Paul Sandle; editing by Michael Holden)