Friday, September 25, 2020

Chancellor called on to cut alcohol duty

The Chancellor of the Exchequer has been called on by the Wine and Spirit Trade Association (WSTA) to cut the wine and spirit duty in the upcoming Budget.

By delivering a freeze to wine and spirits in 2017, the Treasury landed a bumper tax windfall and at the same time helped cash strapped consumers and gave a boost to British businesses.

In 2018 the Chancellor chose to once again freeze spirit duty but singled out wine for an unfair duty rise.

Now, the WSTA is calling for the duty to be cut in a Budget submission sent to the Treasure – a move, it says, will help boost the public purse.

According to the Government’s recent ‘Alcohol Duty Bulletin’, in the last six months since the wine duty hike there has been a slump in wine sales leading to a 2.1% drop in revenue to the Exchequer – falling to £2.4 billion down from just over £2.5 billion.

If the same rate of decline continues forecasts show the Treasury will lose £93 million in 2019 compared to 2018, the association said.

For beer and spirits, both of which received a duty freeze at the last Budget, the revenue income was more positive with beer up 2.4% and sprits up 1.7%.

“We recognise the fact that alcohol duty is an important revenue stream for Government to fund public services, which is precisely why we are calling for a 2% duty cut on wine and spirits,” said WSTA Chief Executive Miles Beale.

“A cut will not only boost Treasury coffers but also bring a boost post-Brexit to British businesses and consumers, whereas another rise will have a negative impact on all three.”

He added: “We agree it’s time for government to change the UK’s unfair, outdated and restrictive wine and spirit duty regime. However, the Chancellor should pre-empt reform with a duty cut.”

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