UK: New 50% tax break on lower strength beers already in force

According to a new fifty per cent tax break for lower strength beers in force since October, 1, all beers with an alcohol content of 2.8 per cent abv and below are now taxed less, to the equivalent of around 35 pence on every pint when compared with a typical 4.2 per cent beer, The British Beer and Pub Association reports.

The British Beer & Pub Association has welcomed the move, which will see Britain’s 5,000 beer brands boosted by new entrants into the lower tax category.

Britain’s beer drinkers can already enjoy a number of beers under 2.8 per cent, such as C2 from Molson Coors, Tennent’s Sweetheart Stout, Harvey’s Sweet Sussex, Mann’s Brown Ale (Marston’s), and Whitbread Best Mild (AB Inbev). New beers already announced include Golden Lite, a new lager at 2.8 per cent from J W Lees, and the reduction in strength of Skol lager, from 3 per cent to 2.8 per cent abv (Carlsberg).

BBPA Chief Executive Brigid Simmonds commented on October, 1:

“From today, it’s official – lower-strength drinks like beer are better for you, according to the taxman. The Government deserves credit for nudging drinkers in this direction, and of course, all beers are low in strength compared with other forms of alcohol.

“We’d now like to see a move to raise the new threshold from 2.8 to 3.5 per cent, which would benefit many more beers, and add a huge boost to lower-strength drinks.

“And as beer is the drink of pubs, let’s not forget that a 35p tax reduction on some beers will help pubs that are struggling.”

Following HM Treasury’s Alcohol Taxation Review, published in November 2010, it was announced that duty on beers of 2.8% abv and below would be reduced, with a ‘revenue-neutral’ increase in beers over 7.5% abv. The reduction for lower-strength beers was later announced to be 50 per cent, whilst higher-strength beers will pay an additional 25 per cent levy.

In total the UK Government raises £9.2 billion from the production and sale of beer, £3.2 billion of which is excise duty.

05 October, 2011