Tag: BBPA

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Britain’s beer tax problem

Don’t have time to really write much about this today but I received an interesting press release from the British Beer and Pub Association (BBPA) this morning.

As the budget approaches, the beer industry is bracing itself for yet another duty increase.  Duty on beer increased by 26% between 2009 and 2010, and is due to carry on increasing.  The Tories have committed themselves to sticking with Alastair Darling’s policy of increasing duty on beer by 2% more than the rate of inflation.  Which means that this year, just a couple of months after a 2.5% VAT increase, we look set for an increase of 5.7%.

Beer volumes are already in steep decline.  The plight of pubs is exacerbated because supermarkets continue to absorb the increases and keep prices low – because they can afford to lose money on beer to get people into the store – while pubs can’t afford to.

Analysts PriceWaterhouse Coopers have predicted that this relentless duty increases will actually result in the government receiving lower tax revenue overall, as the benefit for a higher tax per pint is more than outweighed by the resultant fall in demand the price rise creates.

And yet, incredibly, there are some ill-advised, hostile or just plain ignorant people out there who believe that, in the face of a watered down announcement about minimum pricing, tax on beer is too low.

If you hear anyone spouting such garbage, feel free to share with them a few stats the BBPA pulled together:

UK taxes (duty plus VAT) on beer already massively outstrip rates in any of our neighbouring countries. UK tax rates are EIGHT times higher than in France, TEN times higher than in Spain and ELEVEN times higher than in Germany.
The BBPA analysis also reveals the astonishing figure that Britain’s beer drinkers are paying FORTY per cent of the entire beer duty bill in the European Union – despite Britain’s small, 12 per cent share of the total population.  UK beer drinkers are paying £3.1 billion out of an EU total of £7.7 billion in beer duty revenues.
In addition, some countries, such as Italy, Portugal, and Spain, have lower tax rates of tax for pubs, bars and restaurants – to help their hospitality industries and the hundreds of thousands of jobs that depend on them.
BBPA Chief Executive Brigid Simmonds, comments:
“When it comes to alcohol taxation, we need a debate based on facts, not myths. Our alcohol taxes are among the highest in the developed world, and for beer we have had huge, 26 per cent duty increases in the past two years. What we really need is a freeze in beer duty in the Budget.
“Our already high taxes show that duty-plus-VAT cannot be used as a proxy for a minimum price for alcohol. This would have a particularly devastating effect on pubs. When it comes to tacking alcohol misuse, what we need most is improved alcohol education and awareness, and tougher, targeted enforcement of the huge range of existing laws. Pubs need lower taxes – and less red tape.”

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Beer sales not quite as shit as they have been lately

Every quarter, the British Beer and Pub Association (BBPA) releases a quarterly ‘beer barometer’ that gives you a snapshot of how beer sales are doing in the UK.

As you’re probably aware, UK beer sales have been tanking over the last few years, and this has put the much-criticised BBPA in a difficult position. As the body representing British brewing interests it should be a cheerleader for the industry, actively promoting beer. But increasingly it sounds like a doom-monger, doing more than any other organisation to give the impression that no one is drinking beer or going to the pub any more.
Fortunately, the latest figures – while not exactly positive – are significantly less shit than they have been recently, and this has allowed the BBPA to take a welcome, slightly more upbeat tone.
The headline of the press release is “Beer starts to shake off recession slump”. The key figures are:
  • Total beer sales down 3.6% in October to December 2009, the lowest 4th quarter fall since 2006
  • Beer sales for the whole of 2009 fell by 4.2%, compared with 5.5% for 2008
  • Sales in pubs and bars for the final quarter of 09 were down 5% – compared with 9% in 2008
  • Beer was down in supermarkets and shops in the final quarter by 2.1%, compared with 6.4% in 2008
  • However, over the year a a while, off-trade beer sakes were down 3.1% – the largest annual fall since records began in 1978. This at least raises questions about the received wisdom that the main problem facing pubs is cheap beer in supermarkets
  • Based on these figures, despite Alastair “A barman nicked my girlfriend when I was 18 and my entire economic policy is based on extracting a slow and humiliating revenge from an industry I have learned to hate” Darling having raised duty on beer by more than 20 fucking per cent in the last two years, and having done so purely as a revenue raising measure (anti-binge drinking etc was not a consideration), government revenues from beer have in fact fallen by an estimated £258 million. Nice one, Thunderbirds-boy.

So. People are drinking less beer, and it’s looking like the recession has been a key cause of that. But as BBPA chief executive Brigid Simmonds comments, “As the economy moves into recovery, so will the beer and pub sector. In fact, as in previous recessions, it may emerge first and fastest.”

But Simmonds also warns “What is certain is that any recovery could be thrown off course and destabilised by Government intervention on tax or regulation. What is equally certain is that any move by Government to increase beer tax further this year would be very damaging and place pubs and jobs at greater risk.”

Come on Alastair, get over it. It was a long time ago. Let her go.

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