The Chancellor's original plan would have seen prices rise in February 2023, but instead, the duty will remain frozen until August 2023 when a new system for calculating taxes on alcohol will come into force.
"The move was welcomed by the hospitality trade!"
Obviously, they would have been rather disappointed by Mr Hunt's announcement. Lifting the freeze would have added 7p on a pint of beer and 38p on a bottle of wine. The Scotch Whisky Association said distillers were furious at the average increase of 12% in price. But that's not now happening for some time yet.
The duty has been either cut or frozen in every budget since 2013, and the new measures being introduced in August 2023 will reduce the duty on all drinks with alcohol content below 8.5%, and a blanket tax of 12.5% will be introduced for wines with alcohol content between 11.5% and 14.5%. The measures will run for 18 months from 1 August 2023 to 1 February 2025.
Treasury minister James Cartlidge said the extension would give "maximum certainty" to the industry ahead of challenging times. However, Labour said the sector would welcome the announcement, but branded it another embarrassing "U-turn" and said claims to be providing certainty were laughable.
I do feel that removing arbitrary thresholds on alcohol duty will cut red tape for pubs and other small venues, so that can only be a good thing.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about this extension to the freeze on alcohol duty, it may be a great idea to call me on 01908 774320 and let's see how I can help you.
Don't forget to stay updated with our daily social media posts on Facebook.
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
No unauthorised use, duplication, distribution or modification to any original content contained within this blog is permitted without prior written permission of the author. All other trademarks and registered names are acknowledged.