U.K. Strong Beer Tax
The U.K. budget will next year feature a small but possibly meaningful tax rise on beer with a certain alcohol content. On March 23rd the Chancellor will announce plans to increase tax on beers with an ABV of 7.5% or above.
The government says it is one of the ways it is committed to tackling alcoholism and that does seem to be the case – it’s certainly not going to raise much more tax revenue. Only about 1% of the beer market in the U.K. is made up of 7.5% ABV products, mostly extra-strong lager and some vintage real ales.
While the decision to raise the tax has been cautiously welcomed by some health organisations, others have suggest that it is not going far enough. Don Shenker, chief executive of Alcohol Concern, said that the government were “tinkering at the edges, failing to address the fundamental inconsistencies within the alcohol duty system.”
Shenker was referring to cider, which can often be stronger than beer and occasionally strong enough to bring it into the new tax bracket. Spirits and wines have also been left untouched, a point made by Brigid Simmonds, chief executive of the British Beer & Pub Association, who said that a system was needed “….that nudges consumers to choose lower strength, pub based drinks such as beer.”
At the other end of the scale, beer with an ABV below 2.8% will have its duty lowered, also as part of the overall plan to tackle alcoholism. Whether anyone is going to be tempted to drink a beer with a an alcohol content of less then 2.8% is a good question; you’re certainly going to notice a difference in the taste. We’re not even sure there is any real ale brewed at that strength. It also begs the question of how much you could drink before you found yourself over the drink drive limit although of course you should always err on the side of caution.