Call time on hammering drinkers in your Budget, the Chancellor is warned

CHANCELLOR Philip Hammond faced demands yesterday not to hit drinkers in the Budget, as they already pay more in tax than Germany, France, Poland, Italy and Spain combined.

Drinkers pay more than £11billion in alcohol excise duty each year.

Under current laws 55 per cent of the price of an average bottle of wine and up to 76 per cent of the cost of a bottle of spirits comes from the tax imposed on it.

Miles Beale, chief executive of the Wine and Spirit Trade Association, said: “If duty goes up – on top of the effects of the falling pound and rising inflation – it will inflict a triple whammy on British consumers.”

Boost

The association called on the Treasury earlier this year to reduce duty rates on alcohol. It said a tax cut could not only boost Britain’s wine and spirit industry by £2.9billion but lead to an increase in tax revenues of up to £368million as more consumers bought cheaper drinks and alcohol retailers expanded.

Mr Beale added: “There is one way Theresa May’s government can empower British business almost immediately and that is to support our industry with a 2 per cent cut in wine and spirits duty at the next Budget.

“This would strengthen British business, give consumers a better deal and benefit the Chancellor too.”

The UK pays 40.6 per cent of all alcohol duties in the EU but as a nation, according to World Health Organisation data from 2015, the UK ranked as Europe’s 11th biggest drinking nation. Britons drink less than a number of eastern European countries including Moldova – Europe’s biggest drinkers – and Lithuania and Belarus.

The WHO figures estimated that on average Britons consume the equivalent of 12 litres (21 pints) of pure alcohol per person each year.

This was just ahead of France (11.6 litres), Poland (11.5), Germany (10.6) and Spain (10.6) but almost double that of Italy (6.1).

Finland (11.9) and Ireland (10.9) are the only two countries that have higher duty rates of taxation on alcohol than the UK.

In last year’s Budget duty rates on beer and drinks above 22 per cent alcohol by volume were frozen in cash terms. But rates on wine and cider are still subject to increases in line with inflation. A Treasury spokesman said “Countries choose their tax systems to reflect their needs including the balance between direct and indirect taxes.

“Total alcohol duties in 2016-17 are forecast to raise £11.2billion helping to fund public services, including schools, hospitals and the country’s infrastructure.”