Cider tax causes controversy

Cider tax causes controversy

Tax on cider may shift again after the General Election in the UK after the opposition Conservative Party declared itseld against the duty rise in the Government's Budget.

Conservative Party leaders hinted that they may reverse a 10% above inflation tax rise on cider announced by Chancellor Alistair Darling in the 2010 Budget this week.

"They've used it as a cloak for a huge duty rise on all cider drinkers - instead of just the super strength white ciders that are linked to problem drinking - and that is something that will hit the industry hard and it is something we oppose," said shadow chancellor George Osborne yesterday (25 March).

A Conservative victory in the UK General Election, expected in early May, would likely herald a new Budget.

Darling said the higher tax rise for cider was to "correct a longstanding anomaly" when compared to other drinks.

Cider has escaped the worst of duty tax rises handed on beer, wine and spirits in recent years, but the drink's new-found popularity has the caught the eye of the Treasury.

The National Association of Cider Makers (NACM) lambasted the policy.

"This dramatic increase could well reverse the growth we have generated in recent years," said NACM chairman Henry Chevallier Guild.

"We are at saturation point on the duty on alcohol – even for a success story like cider."

He added: "When Gordon Brown then Alistair Darling left us alone for a few years our investment and innovation doubled the value of the cider market and doubled the contribution we made to government. All that might now be at risk."

Some brewers welcomed the move on cider. "The Chancellor has taken a positive first step in announcing his intention to remove a longstanding duty anomaly between beer and cider and we are keen to understand the process to achieve this in full," said Carling lager brewer Molson Coors UK.