Much has been said on this subject and with the passing of the budget it might no longer seem topical, but it matters, really matters, which is why I am moved to down hops and put fingers to keyboard.

It is no exaggeration to say that the exponential increase in beer duty is killing off local pubs. The beer duty escalator was put in place by the previous Government in 2008 and means that beer duty is increased at 2% above the rate of inflation every year. This is making the price of beer so expensive that fewer people go to pubs to spend their hard earned cash and when they do go, they tend to spend less. There are some quite shocking facts and figures that back this up:

Since 2004 beer duty has risen by 52%

The amount of duty actually paid to the treasury had risen by only 7%

Whilst the amount of beer sold in pubs has fallen, yes fallen, by 25%

These figures have been produced by Oxford Economics on behalf of the British Beer & Pub Association. If you want to find out more detail you can do so here http://www.beerandpub.com/

In the meantime The Financial Times recently reported that pubs have been closing at the rate of 16 a week in last half of 2011 (http://www.ft.com). Other reports cite 52 a week. Whatever the number is it isn’t good.

What this means is that, to use economic terms, as the beer duty rate is pushed up the marginal rate of tax return for the Government is falling dramatically. The total amount of money paid to the Treasury in duty is going up, but not by much and if the duty rate continues to rise much more there is a serious risk that the amount of actual duty paid will fall rather than rise. To add to the relatively poor rate of tax return to the Government, there are many jobs associated with the production and sale of beer that have been damaged as beer sales fall and, most importantly, many, many communities have lost their pubs.

The reason that pubs are so badly hit is that they are, by definition, a more expensive environment in which to drink than having a few beers (or indeed any other kind of drink) at home. This is because pubs, particularly independent pubs, cannot buy in the bulk that supermarkets can and they also have the costs of the premises, staff, entertainment, licences etc. which make pubs the safe, enjoyable places which we know and love. All of this means that any duty increase will have a disproportionate effect on pubs as people seek cheaper drinking alternatives. A recent report from YouGov SixthSense (http://sixthsense.yougov.com/lifestyle-reports/pubs-and-bars.aspx) stated that up to a third of pub goers are now visiting the pub less and about half of these said that it was because drinking at home was cheaper.

In short, the duty rises provide an ever lessening benefit for the treasury, whilst driving people away from pubs, which makes pubs less viable and leads ever more to close. Pubs are at the heart of many communities, they provide company, entertainment, good beer and jobs. They have been part of our social landscape for centuries and yet we are discarding them at a frightening rate. We have to stop this.

To be clear we are not calling for a cut in duty. We believe beer should be taxed as a means of raising money, especially in these difficult times. Further, duty can be a useful means of controlling prices and alcohol available too cheaply is not a good thing. But we would beg, plead, respectfully request and just plain ‘ask’ that beer duty is looked at in the round, not as a bottomless pit of ‘sin taxes’. We are in serious danger of damaging a great British production success story (brewing) and the wonderful institution that is the British pub.

If you haven’t already done so please sign this petition http://epetitions.direct.gov.uk/petitions/29664 on the Government website. If enough of us sign then Parliament will have to consider the beer duty escalator issue.

Better still write to your MP and ask them the questions what benefit does the beer duty escalator bring and what damage does it do? Make those that take the decisions consider the implications. It is too easy for MPs to see beer as a ‘sin tax’ that can go on raising ever more money with no downside; this is not true and it has to stop.

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4 Responses to The beer duty escalator is killing off the great British pub. We must all act.

  1. Darryl Maelzer says:

    Back in the sixties when I discovered pubs, the age range was from 18 to 80. If you wanted to drink socially, the pub was the only place to go. Then along came night clubs, theme pubs and longer hours. If you go into a ‘local’ pub now the demography has changed, no young people, average age 40+ and no females. Pubs have died because their customer base has disappeared, young people go to clubs not pubs.Along came the supermarkets with cheap alcohol, youngsters getting tanked up before going out, BBQ parties at home, Lager, cheap cider,no drinking and driving, booze cruises, greedy breweries,TAXATION, the pubs haven’t stood a chance. Fortunately there is a hardcore of independant pubs which work bloody hard to sell beer and the micro breweries which have sprung up may be the saviour of the pub, but we have to accept that things will never go back to what they were. A point worth considering, if pubs had flourished and maintained their levels, would we all be drinking
    tasteless chemical bitters and lagers, rather than the fantastic real ales which we all have access to now.

    • kathy says:

      There is no denying that things have changed, but there are more micro-breweries in the UK now than ever before. News stories like this are also very encouraging: More than a third of people age 18-24 have tried real ale & 87% would drink it again. New research by CAMRA: http://ow.ly/BydTY

  2. Chris Addlesee says:

    Oldershaw is one of the new tomorrows. Their new bottled brands are really appealing to the youngsters and educate them as to what a premium brew is all about. Sure pubs are closing ,fast, but when one door closes , another opens! Watch this space. ….Good on ya “Oldershaw” , you have potential. X

    • kathy says:

      Hi Chris – thanks for saying nice things about our bottled beers. We’re working hard to get our bottles out and about locally, so if you know anywhere you’d like to see our bottles being sold, please let us know!

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