All three main UK political parties are falling over each to be seen as coming down hard on binge drinkers after the failure of 24hour pub opening to introduce a new continental cafe style drinking culture. Coinciding with a slowdown in the economy and an expected fall in tax revenues, this can only mean one thing for alcohol duties, they’re going up.
Alcopops, cheap white ‘cider’ and strong beers have been singled out for criticism, but spirits and wine duties are expected to rise also.
At present, cider holds a special place in the customs and excise duty regulations. Already lower than other alcohol duties, duties on spirits, sparkling wine and cider have been frozen for at least the last two years.
http://www.hmrc.gov.uk/budget2006/bn55.htm
The rate for beer is calculated on a percentage alcohol basis at £13.26 per hectolitre per cent of alcohol in the beer so a 5% lager would attract duty at £66.30 per hectolitre
The duty on still cider and perry however is levied at a fixed rate of £25.61 per hectolitre up to 7.5% abv, with only a slight increase to £38.43 for 8.5% ( above this strength it counts as apple wine)
So the duty on a mass produced white cider at 7.5% is currently only around a quarter of that on beer of a weaker strength. Wine and spirits are taxed at a higher rate again.
What are the implications for high quality, 100% juice, craft ciders? At present these have the same alcohol duty advantage as the mass produced industrial imposters, so if the duty rates for cider are increased anywhere towards parity with beer, then the cost of retailing craft ciders will have to go up as well, at least for all except the smallest producers who make only 7,000 hectolitres per year or less.
Those are the facts, but these are some of the questions arising:
1) Why is cider taxed less than beer?
2) How can they get away with calling something fermented from less than 30% apple juice “cider” ?
3) Will increased taxation reduce binge drinking?
4) Will it hit craft cider producers worse than cheap white ‘cider; manufacturers?
5) Is this why NACM tried to squash the campaign to defend the small cidermakers exemption? To what end?
And more importantly, here are some possible actions to be urgently adopted:
* Step up the campaign to defend the small cidermakers exemption - the petition currently has 1,400 signatures and is due to be presented to the prime minister in May.
* Build the ukcider Campaign for Real Cider and Perry - only an independent campaign can represent the interests of the real cider producers and drinkers.
* Expose the deceptive NACM definition of cider which allows for less than 30% juice with the unlimited addition of water and sugar before fermentation.
* Support sensible drinking awareness - http://www.drinkaware.co.uk/
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