Scrap the Beer Duty Escalator

There are many radical reforms which should be announced to fix Britain’s broken tax system next month. Scrapping the despised and damaging beer duty escalator should be right up there

by Alex Wild on 28 February 2013 11:29

There are many radical reforms which should be announced to fix Britain’s broken tax system next month. But the Chancellor could do a lot worse than scrapping the despised and damaging beer duty escalator.

In the last four years, the level of beer duty has increased by an astonishing 42 percent. This effectively means that that when you buy a pint of beer at a typical pub today, a third of what you spend goes straight to the taxman.

The escalator, which increases alcohol duty by 2 percent above inflation, has left the UK with the second highest level of beer tax of any country in the European Union. It is now ten times the level seen in Germany and costs £177 per person each year.

Despite many Cabinet ministers condemning the regressive tax in opposition, the Coalition has given the green light to three above inflation increases to help fund their continuing spending binge. The escalator has come at a terrible cost to British pubs: according to CAMRA (the Campaign for Real Ale), over 5,800 pubs have closed since its introduction and continue to close at a rate of eighteen a week.

Sky-high taxes have also fuelled the illicit trade with seizures of fake hooch increasing fivefold over the last two years. So when the Treasury increases alcohol duty, they risk not only losing revenue, but missing their public health objectives as well.

So in the run-up to the Budget, the TaxPayers' Alliance is distributing hundreds of thousands of beermats to pubs across the UK to give the public the plain facts about tax on beer. The campaign launched this week in London with broad cross-party support and is gaining momentum.

The website allows constituents to send a direct message to their MP, urging them to push for the abolition of the escalator next month. Thousands have already signed up and the pressure is building on the Chancellor to make life a little easier for families struggling with increasing living costs. 

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