Jeremy Hunt has declared there will be a freeze on alcohol duty, but the move was met with a mixed response from experts.
During his Autumn Statement, the Chancellor announced ‘he had listened to defenders of the great British pint’ before telling the House of Commons about the duty freeze – which will last until 1 August 2024.
Hunt confirmed this was part of his commitment to the ‘Brexit Pubs Guarantee’, which aims to keep duty on a pint of beer always lower than in shops.
It means the cost of a pint of lager or glass of wine will not be going up ahead of the Christmas party season and the Campaign for Real Ale (CAMRA) said this news is ‘certainly to be welcomed.’
The Treasury’s announcement allows those who enjoy a tipple to finally see a pause on rising booze costs, but due to the rate of inflation, drinkers have been warned to temper any potential excitement.
‘Raising a glass this Christmas is still expensive business’
Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “The announcement of a freeze in duty will give drinkers something to cheer. It doesn’t mean drinkers are off the hook though.
“Inflation figures out earlier this month showed that the price of fortified wines is up 15.3% and beer is up 12%, thanks in part to higher alcohol duty. It means raising a glass this Christmas will still be an expensive business.”
Further, since the National Living Wage will increase for workers in April next year, from £10.42 to £11.44 an hour, venues will soon need to cope with the rise in wages. One expert believes that without any Government support, this could lead to struggling pubs and clubs needing to close down.
Simon Rothenberg, director at accounting firm Blick Rothenberg, said: “Pubs will be pleased by the freezing of duty – but their costs of employing staff have been increased 10% when they are already struggling significantly. There will be more pubs closing as a result of the increase in the national living wage and the same applies to restaurants too.
“Hopefully there will be some support for the hospitality industry to come as it is desperately needed.”
Elsewhere in the Autumn Statement, it was announced that rates on tobacco products will increase by 2%, while the duty on hand-rolling tobacco will surge by 12%, ‘to reduce the gap on cigarette duty’.
