Campaign for Pubs: draught duty won’t help small brewers

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The new draught beer rate of duty discriminates against Britain’s small craft brewers in favour of global giants, says the Campaign for Pubs.

pub people

The group welcomed a 50% business rates cut for hospitality businesses in 2022/23. ut small breweries and other small producers reliant on pubs are not eligible. Something the campaignthinks is wrong.

A 5% cut in draught beer duty will only apply to beers and ciders served from casks and kegs more than 40 litres in size. However, many producers pack their products in smaller amounts, which are also popular with rural and micro pubs.

Thirty-litre kegs, a key size for craft brewers, and small casks of real ale (36-pint pins) are excluded, as is bag-in-the-box cider and perry.

Phil Saltonstall, owner of Brass Castle Brewery, and brewery coordinator for the Campaign for Pubs, said: “Today’s announcement on draught duty relief could have been good news, but instead it disgracefully discriminated against UK craft brewers and the pubs and bars that rely on them.

Wider duty review

“Big beer lobbyists are, of course, celebrating, as this is a huge boost for macro breweries, who will seek to further lock-out small independents from 90% of the sector.”

He said that, with every other associated cost going up, 3p per pint wouldn’t be noticed by consumers or draw people back to the responsible drinking environment of the pub. It would, however, make for healthy balance sheets in the relatively few big breweries.

He added: “The headline duty measure undermines small supplier competitiveness and gives very limited support to pubs. Now we have to wait to hear how the wider duty review will impact, and what happens to small brewers’ relief when it is rolled across other alcohol types.

“The omens are not good, though, given the lobbying power that indie producers are up against. But the Campaign for Pubs will continue to speak up for them and for publicans.”

Campaign for Pubs

The campaign had also called for a 5% rate of VAT in pubs, which wasn’t announced, and many will feel increased pressure as the national minimum wage rises. Products and energy bills are also going up, too.

The campaign is still also calling on the government to take meaningful action on rents. Some pub-owning companies and commercial landlords are charging full rents on pubs, despite trade still being reduced. So far, the government’s voluntary covid rent code of practice has failed to address this problem, says the campaign, and with rent being the biggest cost for many pubs, meaningful action is still needed to allow some pubs to survive.

Campaign vice-chair, and licensee of The Rose, Norwich, Dawn Hopkins, said: ““Despite the headlines, the reality is that, other than the welcome news about 50% business rates next year, which is vital for pubs, the government has provided millions of pounds of tax relief to global brewers, whilst discriminating against the many wonderful small craft brewers in the UK and small pubs and micropubs who rely on them.

“So the chancellor must look at this again and stop listening only to the voice of the global brewers and pubcos. The reality is that with rising brewery costs, high energy prices, and ongoing uncertainty due to covid, the price of a pint will rise far more than any duty cuts, so customers will not notice and it seems the changes are even not coming in yet.

“The outlook remains tough for the UK’s pubs and it is time that the government listened to those who actually ran pubs, rather than to those who lobby on behalf of the huge corporations, and supported pubs directly through this winter.”