The Government has introduced differential rates for stronger beers, and has said it will restrict the sale of alcohol at below the cost of duty and VAT combined.
The VAT rise increased the price of a pint in a pub by 5p – whilst increasing the price of a can of beer in a supermarket by less than 2p. This has hit pubs hard – and by hitting pubs harder than supermarkets risks hitting the pub trade harder than duty increases.
In February 2012 Andrew Griffiths MP tabled a motion in Parliament calling for the escalator to be suspended, which 121 Members signed. An ‘e petition’ supporting this change has been signed by over 63,000 people.
Andrew Gwynne MP said:
“Pubs and many businesses are struggling at the moment – we have had zero growth in the last year in our economy and the longest double dip recession since the Second World War.”
“As part of 5 point plan for growth and jobs Labour is calling for a temporary and emergency cut in VAT back to 17.5% until the economy is growing strongly again – easing the squeeze on families and getting the economy moving again.”
“This would cut the price of beer in a pub by over 5p – a review of the impact of beer duty on the economy and jobs in the pub trade would clearly need to examine the impact of VAT as well as it amounts to half of the total tax paid on Beer in pubs.”