Britain’s pubgoers could soon pay more for their pints as the Chancellor prepares to raise alcohol duty, piling fresh pressure on an industry already battling squeezed margins, rising costs and fragile consumer confidence.
The proposed 3.9 per cent increase, expected to be announced in Wednesday’s Budget, would push the tax on a pint of beer from 50p to 52p. Wine drinkers could face an additional 10p to 12p per bottle, depending on its strength, while duty on a bottle of gin at 37.5 per cent alcohol would rise by 35p.
The increase would be linked to September’s Retail Prices Index (RPI), a measure of inflation that typically runs higher than the Consumer Prices Index (CPI), which stood at 3.5 per cent.
The prospect has triggered a growing backlash from Britain’s drinks industry, with trade bodies warning that higher taxation risks undermining jobs, investment and the viability of local pubs at a time when households are already under pressure.
Miles Beale, chief executive of the Wine and Spirit Trade Association, urged the Chancellor to freeze duty rather than impose another burden on consumers and businesses.
“With a cost of living crisis and an aim for growth in every postcode, this Government should be supporting not squeezing the British drinks sector,” he said.
Beale also questioned whether repeated increases had delivered the additional revenue ministers might expect. Alcohol duty receipts peaked at £13.2bn in the 2021-22 financial year and have remained below £12.5bn annually since.
Emma McClarkin, chief executive of the British Beer and Pub Association, warned that higher taxes could put employment at risk across a sector with the potential to provide opportunities for younger workers.
She argued that British brewers face beer duty rates 12 times higher than their counterparts in Germany and Spain, and called for a freeze to bring the UK closer to European competitors.
For pub operators, the concern is that even modest increases could compound already wafer-thin economics. Chris Jowsey, chief executive of Admiral Taverns, said the typical British pub makes a margin of just 12p on every pint sold.
He called for a freeze in beer duty and an increase in the draught duty discount to 30 per cent, arguing that both measures would ease pressure on publicans and help keep a visit to the local affordable.
The industry is also pressing for wider business tax reforms, including raising the small business rate relief threshold from £12,000 to £18,000 to reflect inflation, and cutting hospitality VAT to 10 per cent.
The Treasury declined to comment on the expected measures, saying tax decisions would be set out by the Chancellor at fiscal events.
For Britain’s pubs, the Budget could therefore prove a test of whether the Government’s growth ambitions extend to the high street — or whether drinkers and publicans will once again be left to absorb the cost.
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