The price of wine and spirits is set to rise after alcohol duty was hiked in today’s Budget. But draught pints will receive a tax cut.
Rachel Reeves announced on Wednesday that the levy on non-draught drinks will rise in line with inflation from February next year. But at the same time, draught duty will be cut by 1.7 per cent. The Chancellor said this means “a penny off a pint in the pub”.
Her announcement was cheered in the House of Commons by Labour MPs. The Chancellor told the Commons on Wednesday afternoon: “I can confirm that alcohol duty rates on non-draught products will increase in line with RPI from February next year, but nearly two-thirds of alcoholic drinks sold in pubs are served on draught.
“So today, instead of uprating these products in line with inflation, I am cutting draught duty by 1.7%, which means a penny off a pint in the pub.”
Alcohol duty is a tax that manufacturers pay when making drinks. The levy changes depending on the alcohol content of the drinks. In general, spirits and wines are taxed much heavier than ciders and beer, because they are more alcoholic. The duty is generally passed onto punters by businesses, but price increases are at their choice.
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