Alcoholic Drinks: Excise Duties

(asked on 9th February 2022) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the potential merits of reducing the differences between tax rates for different categories of alcohol and applying one basic rate per litre of pure alcohol to all categories of drinks, in order to simplify and standardise the alcohol duty system.


Answered by
Helen Whately Portrait
Helen Whately
Minister of State (Department of Health and Social Care)
This question was answered on 21st February 2022

The Government believes that the reforms announced at Autumn Budget 2021 will achieve a duty system that is simpler, fairer and better supports public health in the round.

There will be one duty band for all products between 8.5%-22% ABV based on their alcohol content. This simplifies the existing system by eliminating the different duty rates for still wines, sparkling wines, spirit-based liqueurs and stronger beers, and replacing them with a single rate.

In principle, the Government considers it is right to tax higher strength products a higher rate of duty per unit. Introducing one basic rate per litre of pure alcohol would fail to target higher strength products. As set out in the summary of responses published in October 2021, public health groups and economists have cited a link between cheap, high strength spirits (such as vodka) and alcohol-related harms, as the volume of drink needed to reach intoxication is smaller with higher strength drinks.

The Treasury is continuing to engage with other Government departments and interested stakeholders on these reforms. A consultation ran from 27 October 2021 to 30 January 2022, and the Treasury is now analysing the responses. Further updates will be provided in due course.
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