BUDGET Alcohol duty and other key points

TAXES on draught beer, cider and sparkling wine are being cut as part of a huge overhaul of the UK’s alcohol duty system, the Chancellor announced.

Rishi Sunak said this will include cutting the price of a pint in a pub by 3p as part of a new lower duty rate.

The Chancellor told MPs in his Budget speech that the planned increase in duty on spirits such as Scotch whisky, wine, cider and beer would be cancelled from midnight.

He said this alone will represent a tax cut worth £3 billion.

Mr Sunak criticised the current system of alcohol taxes as outdated and too complicated, as he revealed a raft of changes.

“We are taking advantage of leaving the EU to announce the most radical simplification of alcohol duties for over 140 years,” he said.

“We’re taking five steps today to create a system that is simpler, fairer, and healthier.”

The Treasury said it will slash the number of main duty rates from 15 to six as part of the sweeping changes.

The Chancellor said changes to duties will see taxes increase on some higher strength drinks, such as some red wine and “white ciders”.

However, consumers of some lower strength products, such as rose, fruit ciders, liqueurs, and lower strength beers and wines, “will pay less”, he said.

Mr Sunak also specifically targeted the “irrational” duty level of 28% of sparkling wine, saying that the tax will be reduced on champagne, prosecco and other sparkling wines which are typically lower strength.

Pubs and bars will also benefit from a new “draught relief” which will cut duty on beer and cider sold in pubs by the most since 1923, the Treasury said.

Emma McClarkin, chief executive of the British Beer & Pub Association, said: “Pubs, brewers and beer drinkers will be toasting the Chancellor today for a range of business-boosting measures.

“Pub goers will also be toasting the Chancellor for announcing a 5% lower duty rate on draught beer worth £62 million.

“This is great news for our local pubs and recognises the crucial role they play in our economy and society.”

Other key points:

Universal credit taper rate cut

» The taper rate is currently set at 63p – a claimant who is also in work gets 63p taken off them for every extra pound they earn. The taper rate will be cut from 63p to 55p, meaning someone on universal credit who earns an extra pound through work would get to keep 45p, rather than the 37p they retain at present.

Minimum wage rise

» Minimum wage for over-23s to rise from £8.91 to £9.50 an hour (£9.18 for 21-23s; £6.83 for 18-20s; £4.81 for 16-17s and apprentices.

Public sector pay

» One-year public sector pay freeze to end for 5.5million workers – but no guarantee wages will rise above inflation or departments will get new money to fund them.

Smoking

» Duty rates on cigarettes will rise by RPI inflation plus 2% from 6pm today – adding 61p to cheapest pack of 20.

» Rate on hand-rolling tobacco to rise by RPI plus 6% – adding 89p to a 30g bag.

Driving

» Fuel duty frozen for 12th year in a row – handing £1,900 to the average car driver since 2010.

» Suspension of the HGV levy extended until 2023 to ease supply shortages.

» Vehicle excise duty for heavy goods vehicles frozen to help supply crisis.

Air passenger duty

» Air passenger duty will be cut for domestic flights, but tax on “ultralong-haul” flights, any flight over 5,500 miles, will increase.

Housing

» New property developers’ tax of 4% on profits over £25 million, to help create a £5 billion fund to remove unsafe cladding.

Culture

» Museums, theatres, galleries and orchestras’ tax relief to be doubled. One hundred libraries and museums will be renovated.

Business rates and technology

» Business rates will be cut to halfprice for one year for companies in retail, hospitality, and leisure, up to a maximum of £110,000.

» Business rates investment relief to encourage firms to adopt green tech, like solar panels.

» Businesses will face no extra business rates for 12 months after making property improvements.

Courts

» Extra £2.2bn for courts, prisons and probation services, including £500,000 to reduce court backlogs.