UK: Spirits main losers in UK Budget - industry "disappointed"
Taxes on alcohol in the UK have been raised markedly in today's (12 March) Budget announcement.
The Chancellor of the Exchequer, Alistair Darling has this lunchtime confirmed that alcohol duty will be increased across all alcohol categories, most notably spirits.
While beer duty will be upped by GBP0.04 per pint, and cider wil rise by GBP0.03 per litre wine will have its tax increased by GBP0.14 per bottle.
"In 1997, the average bottle of wine bought in a supermarket was GBP4.45 in today's prices," the Chancellor said. "If you go into a supermarket today, the average bottle of wine will cost about GBP4.00."
Spirits, meanwhile, were hit by a 10% rise in excise rates, equating to about GBP0.55 a bottle in the country.
All alcohol duties will be increased by 2% above inflation for next four years.
The move has received an expected thumbs-down from the drinks industry. ""The Chancellor cannot have it both ways," said Edwin Atkinson, director general of the Gin and Vodka Association. "Either he wants more revenue or he wants to reduce consumption. For spirits, he cannot have both. And given the huge increases in production costs, this increase is even more concerning."
The GVA dismissed the budget as one that "will not deliver".
"That the Government should commit itself and future Governments to an above inflation rate increase for alcohol for the next four years is hitting all drinkers for the sins of a minority," the association said. "It abandons the previous Government policy of creating fairness in taxation between competing alcohol drinks."
The UK units of Diageo and InBev, meanwhile, both described themselves as "disappointed" at the tax changes. "Our industry is already contributing over GBP21bn to the Treasury and is investing over GBP400m in Scotch production," said Benet Slay, managing director of Diageo GB. "This decision flies in the face of Government creating good domestic conditions for an industry so crucial to this country's economy."
"Worse, it penalises all responsible adults who enjoy a dram, a pint or a glass of wine."
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