A number of constituents from Mid-Sussex have been in touch recently regarding the Government support for our pubs and I have been raising these concerns with my colleagues in the Treasury, including the Chancellor, emphasising the importance our pubs continue to play in our local communities, as well as the need to support them during what are incredibly challenging times. I want to provide you with the latest updates and information I have from the Government.
Our local pubs play a crucial role in the social, cultural and economic life of our nation and I wholeheartedly share the concerns of people across the country about the impact of, and current challenges our pubs are having to face due to, the coronavirus outbreak. I have spent a lot of time discussing challenges with our local pub landlords and I have been feeding their thoughts back to my colleagues in Westminster.
You may be pleased to know from 1 August the alcohol duty system will be simplified and rates will be uprated. Duty rates of all alcoholic products produced in, or imported into, the UK will increase in line with RPI. Draught Relief will increase from 5 per cent to 9.2 per cent for beer and cider draught products and from 20 per cent to 23 per cent for wine, spirits based and other fermented draught products.
I also welcome the Government’s commitment to supporting pubs through increasing Draught Relief from 1 August as announced in the Budget. This will freeze the duty charged on a typical pint of beer in the pub and ensure this will always be lower than in the supermarket.
All tax categories, such as beer and wine, will be moved to a standardised set of bands, with rates for products between 1.2-3.4 per cent alcohol by volume (ABV), 3.5-8.4 per cent ABV, 8.5-22 per cent ABV, and above 22 per cent ABV. Above 8.5 per cent ABV, all products across all categories will pay the same rate of duty if they have the same proportion of alcohol content. Registration and payment will also be simplified, and the practice where individual products have different administrative rules will end.
The new way in which alcohol is taxed will ensure higher strength products incur proportionately more duty, and these rates will be the same across all product categories. This change will address the problem of harmful high-strength products being sold too cheaply, and the new rates for low strength drinks below 3.5 per cent ABV will encourage manufacturers to develop new products at lower ABVs, giving consumers greater choice and greater options to drink responsibly.
Finally, I welcome the introduction of a new, small producer relief which will build on the previous success of the Small Brewers Relief, which will benefit cidermakers and other producers of lower ABV drinks. This will allow small producers to diversify their product range to other products below 8.5 per cent ABV while still benefitting from reduced rates.
Our pubs play a huge role in British society and I want to see the Government continue to support pubs through measures introduced to relieve the financial burden they are facing at this time. I have been assured the Government will continue to closely monitor how to adjust support and measures which directly affect our pubs in the coming weeks and months ahead.
I have ensured my colleagues are aware of the points both yourselves and others have raised, reminding them of the importance of local pubs to our communities. I will continue to follow developments closely and will update constituents as and when there are any.
You can read more about my support for pubs here: https://www.mimsdavies.org.uk/supporting-our-pubs