Autumn Budget: our response

Lucy Holmes | October 2021 | 7 minutes

It is deeply regrettable that the Chancellor has decided to cancel a planned increase on alcohol duty, ignoring the evidence that clearly shows that cutting duty increases alcohol harm.

He has missed yet another important opportunity to significantly reduce the harm caused by alcohol and to cover the costs of that harm. Instead, he has given a tax break to massive alcohol producers who have continued to see huge profits throughout the pandemic.

This cut will hurt the public purse by further decreasing revenue receipts by £500 million next year alone1, and could make cheap booze even more affordable, causing greater harm – when deaths caused by alcohol rose by 20% in 2020.

However, the announcement of the long-awaited review of alcohol duty has some more positive indications.

We have been calling for an overhaul of the system to make it fairer, more consistent and geared towards promoting public health. Today, the Chancellor has announced one important measure that we strongly welcome: a simplified system of duty that taxes alcoholic drinks according to their strength. While this change won’t come into force until 2023, it represents a welcome improvement.

We will carefully scrutinise the detail of the other proposed changes but, if the strongest, cheapest drinks rise in price, this will go a long way to reducing alcohol harm and is to be welcomed. However, the Chancellor also signalled his intention to reduce the duty paid on draught beers and ciders. Applying a different rate of duty to draught beer and cider sold in pubs and that sold in shops is, in principle, a helpful way of making cheaper, unsupervised drinking less attractive in comparison to drinking in licensed venues. However, any reduction in alcohol duty risks causing greater harm, and is a cause for concern.

The hard work doesn't end here. The Treasury has opened a consultation about the proposed changes to alcohol duty. We will start working on our response immediately and will look forward to working with our supporters and the government to shape an alcohol duty system that helps reduce and prevent serious alcohol harm.

1. According to the Treasury’s ‘Autumn Budget and Spending Review 2021 Policy Costings’ p13.

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