Rachel Reeves has announced that alcohol duty rates on non-draft products will rise in line with next year's RPI as part of Labour's efforts to plug what it claims is a £22bn fiscal “black hole”, but there are some good news. There was also news. For beer lovers, the price of a pint drawn in a pub will drop by a penny.
The official reason for this is to “encourage responsible drinking in a social and controlled environment”.
The Prime Minister's announcement drew loud cheers from members of the House of Commons.
Mr Reeves said the government would renew the tobacco tax escalator at RPI plus 2% for the remainder of the parliamentary term, raise tariffs on hand-rolled cigarettes by a further 10% this year and introduce a flat rate tax. he added. Applies to all vape liquids from October 2026.
For many pubs, this will mean some relief from the national minimum wage rate and an increase in employers' national insurance contributions, as well as reductions in rate relief in many areas. But many people won't be able to consider lowering the price of beer.
Alison Bouteuil, founder of CityStack London Pub Collection, said: “The recent reduction in alcohol tax on draft beer is a positive step and shows the Government is recognizing the importance of pubs as vital community hubs. It shows,” he said.
“However, increases in national insurance and the minimum wage, while necessary to address the cost of living crisis, will place additional financial burdens on small businesses.”
Many exploiters are taking matters into their own hands and looking at ways to bring in more revenue ahead of Christmas, one of the hospitality industry's busiest times of the year.
But with fierce competition from big chains, they have to find new ways to stand out.
CityStack supports independent pubs and allows Londoners to socialize on a budget with a special beer mat offering £10 off your £20 spend at any 10 of over 50 participating London pubs This is an initiative to support such people.
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“Independent pubs have faced a myriad of challenges in recent years, including inflation, declining customer numbers, staff shortages and rising operating costs,” Alison said.
“What they need now is relief from financial pressure, nothing more. It would have been beneficial to have more support from the government to help small businesses thrive.”
It remains to be seen whether the pennies on each pint will actually reduce bills for customers, or whether they will have to go towards mitigating losses from tax increases elsewhere in the budget.
