UPDATED: The UK government said today it would increase alcohol duty rates in line with inflation to “maintain its real terms value”, a move welcomed by health advocates, while also tinkering with an incentive to reduce alcohol content.
“The announcement is a welcome foundation to build on,” said Professor Sir Ian Gilmore, Chair of the Alcohol Health Alliance UK, who also calling for this inflation tracking to be made automatic.
This would “provide greater certainty for the government, support public health objectives and ensure alcohol duty makes a fairer contribution towards the cost of alcohol harm”, Sir Ian said.
“We hope this will be followed by a comprehensive national alcohol strategy, including responsible, evidence-based fiscal measures to reduce alcohol harm,” said Katherine Severi of the Institute Of Alcohol Studies.
Alcohol tax cuts help supermarkets win market share from hospitality because tax makes up a far larger proportion of the price of shop-bought products.
Products under 3.5% are taxed at under £10 per litre of alcohol, less than half the amount of those above that threshold. The scheme is credited with alcohol reduction in a range of mass-market lagers since its introduction in 2023.
“The government will implement a more generous discount taper for products below 3.5% ABV–strengthening incentives to produce lower-strength products–and uprate the marginal discount for products between 3.5%-8.4% ABV by RPI+10% from February 1st 2027,” the Budget says. ■