BBPA issues warning about beer tax hikes in final push for cut duty

With the Budget now just a day away, the British Beer & Pub Association (BBPA) has issued a final warning that any return to beer tax hikes would be a major setback for brewers and pubs.

Many pubs are struggling with rocketing business rates and other new costs this year, from the National Minimum Wage, auto-enrolment for pensions and the Apprenticeship Levy. All four are adding the equivalent of 5.3p tax on a pint, regardless of any possible beer duty increases.

The comments come from the BBPA’s Chief Executive, Brigid Simmonds, who is making a final push for a one penny duty cut, with a letter in the Daily Telegraph today supported by 39 leading figures in the brewing industry, arguing the overwhelming case for a beer duty cut on Wednesday. Further pressure is being applied by a cross-party coalition of MPs in a Westminster Hall debate in Parliament today.

The BBPA is also highlighting analysis commissioned from Oxford Economics, which shows there is no ‘pot of gold’ for the Chancellor in raising beer duty.

The leading economic research organisation estimates that 5,300 jobs would be lost if the Chancellor raises duty as currently planned, rather than cutting it by a penny, as done three times by George Osborne.

The modest, £91 million loss in beer duty would be almost entirely covered by an estimated £89 million in extra revenue from boosted employment and other taxes. Even a duty freeze, rather than a cut, would safeguard 3,300 jobs, also at an exceptionally small net cost, of just £2 million, to the Treasury.

BBPA Chief Executive, Brigid Simmonds, commented, “Our beer taxes are already three times the EU average, and pubs face big new cost challenges this year.

British beer sales have stablised since the abandonment of huge tax rises led to huge sales losses under the beer duty escalator. Any return to tax hikes would be a massive setback for the industry and the 900,000 people we employ.

“Instead, by continuing the sensible tax policy begun in 2013, the Chancellor can create confidence in this important sector, and bring cheer to pubgoers – and all at virtually no cost to the Treasury.

“It is not too late for anyone to support the campaign by sending your local MP a message via the BBPA’s campaign website www.cutbeertax.co.uk.”