Increasing the draught discount for pubs by 30% and freezing beer duty could lead to more affordable pints and over 7,000 more jobs in the sector, according to the British Beer and Pub Association (BBPA).
Ahead of the Budget, the trade body is calling on the government to support jobs, the price of a pint, and the industry through meaningful action.
According to the BBPA, beer duty accounts for up to 40% of the wholesale price of beer, with British brewers paying some of the highest rates in Europe — 12 times that of Germany and Spain.
Beer duty and other cost pressures, including staffing costs and business rates, means that British pubs make just 12p per pint. Brewers making 3p on a 500ml bottle of beer, giving businesses no other choice than to pass costs on to consumers.
The trade body says that, with inflation still on the up, increasing the draught discount and freezing duty would give both pubs and brewers the space to invest, protect consumers from increased prices, and hire more — especially young people.
Analysis from the BBPA finds that increasing the draught discount to 30% and freezing beer duty would allow pubs and brewers to employ 7,100 more workers, 3,400 of whom would be under 25.
According to the BBPA, the regions that would benefit the most from these measures are the South East (1,066 jobs), South West (900 jobs), North West (789 jobs), London (760 jobs),and the East of England (675 jobs).
“At a time when young people are finding it really tough to find work, supporting the beer and pub sector would mean government are helping us create much-needed jobs,” said Emma McClarkin, chief executive of the BBPA. “Increasing the draught discount and freezing beer duty at its current rate would be an undisputed win-win, meaning more affordable pints, greater investment, and more jobs.
“Our brewers are forced to pay some of the highest rates of beer duty in Europe, 12 times more than Germany and Spain. Freezing the tax at its current rate, rather than the planned increase, will start to bring our brewers closer in line with our European counterparts.
“Ahead of the Budget, the government has a real opportunity here to back Britain’s brewers, pubs, and jobs by building on their support for the sector with a freeze on beer duty and a 30% draught discount.”
In February, the government increased beer duty by 3.6%. While the Treasury described this as being in line with inflation, the BBPA calculated a £129 million additional bill for Britain’s brewers every year. The trade body also revealed that every 1% increase to duty removes £35 million of potential investment from brewers.
Ahead of the Budget, the BBPA is calling on the government to support the industry through a freeze in the current beer duty rate, an increase in the draught discount to 30%, a review of employment costs for young people, permanent business rates reform, and a fairer VAT regime for pubs and hospitality.
