MPs call for cut in beer duty to save struggling pubs

A group of MPs is calling on the government to reduce the tax burden on pubs and breweries to prevent more businesses closing for good.

The All Party Parliamentary Beer Group (APPBG) said more than 2,000 pubs and breweries in the UK have already permanently shut during the pandemic and many others are struggling with huge debts.

It is urging ministers to lower alcohol duty, VAT or business rates to help the industry recover from the pandemic. This includes specifically lowering duty on draught beers, which are exclusively available in licensed premises and have been hit by the enforced closure of pubs.

The Treasury is currently conducting a review of alcohol duty which is expected to finish during the summer.

Mike Wood MP, chair of the APPBG and Conservative MP for Dudley South, said halving the tax on draught beer to 22p on an average strength pint would provide a £600m "shot in the arm" to the industry.

"The quintessential British pub has never been more vital to our communities than it is today, as we emerge from the dark isolation of the past 14 months," said Wood.

"Unfortunately, in order to survive and thrive, the industry needs government to go even further in its support, extending and building on some of the measures introduced after March 2020.

"Supermarkets have flourished over the past year, with sales of wine and spirits soaring. But now we need to make sure that pubs and breweries come out of this fighting too."

The APPBG report, named 'Caskenomics: cask beer's Covid crisis', said prior to the pandemic cask beers contributed 72,500 jobs to the UK economy. Due to its short shelf-life, 87 million pints, worth more than £300m, had to be poured away during lockdowns.

According to the report, sales of cask beer fell 72% to the end of February 2021 and without further government support British hop farmers could go out of business and many pubs would lose trade.

Kelly McCarthy, landlady of the Ye Old Sun Inn, Tadcaster, and chair of the Yorkshire section of the British Institute of Innkeeping, said: "In March 2020, it felt like our world had fallen apart. Now, the pubs need a cut in duty, to bring them back into the spotlight; to do that, we need the support of the government.

"It's essential that the government presses ahead with the roadmap out of lockdown and plans for 21 June. How can businesses plan without that certainty?"

Image: Eugenevortep / Shutterstock