Alcohol duty increases due to come into force early next year are to be delayed for six months in what will be a welcome boost for the hospitality trade and brewers.
Former Chancellor Kwasi Kwarteng pledged to freeze alcohol levies in his disastrous mini-Budget in September. However, his successor Jeremy Hunt scrapped the move when he took over in October, meaning increases were due from 1 February at a time when hospitality firms are already struggling with higher costs and weakening consumer demand.
Alcohol duty was due to rise by RPI inflation, which would have seen 7p added to the price of a pint of beer, 38p on a bottle of wine, and a more than £1.30 hike on the price of a bottle of spirits.
However, following weekend press reports, Hunt is expected to confirm in Parliament later today that the increase will now be delayed until August.
Michael Kill of the Night Time Industries Association (NTIA) commented: “We welcome the announcement today that Alcohol duty will be frozen until August by the Chancellor, but urge the Government to recognise the full extent of the problem, and consider further support in the coming months for many businesses to survive.
“The Alcohol duty freeze will give businesses some breathing space but will not repair the damage already done or solve the immediate challenges faced by the sector following three years of disruption.”
Nuno Teles, Managing Director at Diageo GB, added: “The decision by the Chancellor to freeze alcohol duty until August will come as a much needed Christmas present for hard pressed pubs, bars and restaurants up and down the country. Today’s news provides much needed certainty for the sector and we raise a glass of Guinness to the Chancellor and the PM in thanks. Cheers, Chancellor!”
NAM Implications:
- A mere drop in an ocean of hospitality issues…
- Hospitality stakeholders undergoing an unprecedented shakeout of overlap and weakness re diminishing demand.
- With survivors growing at the expense of weaker rivals.
- That is the new kitchen, that may be too hot for some, regrettably…
