A freeze in alcohol duty is to remain in place until 1st August 2023, the government has confirmed, before a simplified system for taxing alcohol takes effect.
Alcohol duty had been due to rise from February 2023, but the decision has been made to cancel the rise in order to provide further support to the hospitality sector and drinks producers amid inflationary pressures on their costs as well as decreased consumer spending.
Exchequer Secretary to the Treasury James Cartlidge said:
“[The] announcement reflects this government’s commitment to responsible management of the UK economy and supporting hospitality through a challenging winter.
“The alcohol sector is vital to our country’s social fabric and supports thousands of jobs – we have listened to pubs, breweries and industry reps concerned about their future as they get ready for the new, simpler, alcohol tax system taking effect from August.
“That’s why we have acted now to give maximum certainty to industry and confirmed there will be just one set of industry-wide changes next summer.”
Changes to alcohol duty, announced in the Autumn 2021 Budget, will come into effect next summer, linking the alcohol content of the drink to its duty, with tapered relief available for smaller producers. New rules will see duty lowered on lower strength liqueurs, bringing them in line with similar ABV drinks like fortified wines, while strong beers and ciders will incur a higher duty.
As well as the freeze to alcohol duty, the hospitality sector has also welcomed and announcement that licensing hours in England and Wales will be extended to 1am on the date of the coronation of HM King Charles III.
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