Chancellor Rachel Reeves has delivered a Budget blow to pub-goers across the UK, confirming that alcohol duty will increase in line with inflation, potentially pushing up the price of a pint.
What the Budget Means for Your Pint
The Chancellor announced during her Autumn Budget that alcohol duty will now rise in accordance with the Retail Price Index (RPI), which currently stands at 4.5 per cent. This change, typically implemented from September, means the cost of alcoholic drinks in pubs and restaurants is set to increase in the near future as businesses grapple with higher costs.
Pub and restaurant industry leaders had urgently appealed to Ms Reeves to avoid increasing the duty, but their efforts proved unsuccessful as the Chancellor confirmed the measure earlier today.
Industry Backlash and Warnings
Sir Tim Martin, founder and chairman of the JD Wetherspoon chain, had previously warned the Chancellor about the dangers of further duty hikes. He highlighted that pubs and the hospitality industry are still recovering from recent economic pressures.
"Pubs and the hospitality industry bore the brunt of the big tax increases in National Insurance Contributions (NICs) only a few months ago," Sir Tim told Metro. He emphasized that increasing alcohol duty would "again affect pubs more than any other industry, when most have not recovered from the pandemic."
The Struggling Pub Sector
The industry veteran outlined how pubs have been losing ground to supermarkets over recent decades, with half of their beer volumes shifting to retail supermarkets over the past quarter century.
"No industry can survive that level of attrition," Sir Tim added, pointing to the sustained challenges facing traditional pubs.
In earlier comments to The Sun, the multi-million pound firm's boss had been even more direct about potential tax increases for the hospitality sector. "If Rachel Reeves even dreams about putting taxes up for locals, she'd better wake up and apologise," he stated.
Sir Tim made his position unequivocally clear, adding: "I think pubs have been taxed up to the hilt and any more taxes are a bad idea."
The duty increase comes as part of broader Budget measures that will see millions paying more in income tax, alongside the introduction of a mansion tax for certain UK households.
