Drinks trade heralds UK duty cuts, but wine misses out

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The UK drinks industry has welcomed "historic" cuts to excise duties in today's Budget, with wine the only category to miss out on a reduction.

Beer saw a third successive duty cut in todays Budget

Beer saw a third successive duty cut in today's Budget

In his Budget speech, the Chancellor, George Osborne, announced a 2% cut in the rate of duty on spirits and cider, while beer duty will come down by GBP0.01 a pint. Wine duty was frozen.

It is the third Budget in a row that beer tax has been reduced and only the fourth time in the last 100 years that spirits have benefited from a cut in duty.

David Frost, the Scotch Whisky Association's chief executive, hailed the reduction as an "historic decision". He added: "The move is a major boost to our industry as we look to grow again in the UK, and equally sends out an important signal on fair taxation to our export markets."

The Wine & Spirit Association, which has been running a 'Drop the Duty' campaign, welcomed the move on spirits. But, CEO Miles Beale said the group is "disappointed" about wine. "Freezing wine duty is an improvement and a first step towards supporting wine businesses that are looking to invest in the UK, create jobs and back British pubs," he said.

Brigid Simmonds, the British Beer & Pub Association's chief executive, said: “Beer tax is now GBP0.10 lower than it would have been under the beer duty escalator, which he (the Chancellor) abolished. It will boost employment by 3,800 this year alone and attract new capital investment." 

She added: "It will put GBP180m in the pockets of beer drinkers and pubgoers. That is a huge difference." 

For more industry reaction, see our live blog here.

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