High-strength alcohol more expensive as new duties come into force
A new system for taxing alcohol has come into force in the UK, increasing the price of many drinks.
Alcohol duty, which had been frozen since 2020, increases by 10.1 per cent overall but will fall on lower-alcohol beverages.
Previously tax on alcohol was based on type of drink, with four separate taxes covering beer, cider, spirits and wine.
Now drinks with alcohol by volume (ABV) of 3.5 per cent or lower will be taxed at a lower rate, while the increase will apply to drinks with ABV 8.5 per cent or higher.
This means the average bottle of wine (ABV 12 per cent) will increase by 44p, an average bottle of beer (4.5 per cent) will be 4p more and an average bottle of vodka (37.5 per cent) will be 76p extra.
The new duty will not apply to beer sold in pubs, in a bid to support the sector.
Chancellor Jeremy Hunt said: “The changes we’re making to the way we tax alcohol catapults us into the 21st century, reflecting the popularity of low alcohol drinks and boosting growth in the sector by supporting small producers financially.”
A Scottish government minister, though, has criticised the changes, warning it will have a negative impact on the Scotch whisky sector.
Small busines minister Richard Lochhead tweeted: "Today the Tories have slapped a 75 per cent tax on to a bottle of Scotch whisky, breaking their promise to the industry and using Scotland’s national drink as a cash cow."
Drinks sold in Scotland are already subject to minimum unit pricing (MUP), which set a floor print of 50p per unit.
The changes to alcohol duties make a similar change, in that it makes stronger alcohol more expensive.
The Scottish Government is currently consulting on whether to further increase MUP, with a survey to businesses seeking views on a new price of 60p, 70p, 80p or more per unit.
Public health groups have welcomed the changes to alcohol duty.
Elinor Jayne, director of Scottish Health Action on Alcohol Problems, said the move will save lives. She said: “Increasing alcohol duty in line with inflation and basing the system on alcoholic strength will decrease population-wide consumption and therefore reduce the number of people tragically losing their lives to alcohol.
“On top of the floor price set by minimum unit pricing in Scotland, today’s changes will save lives and raise much needed money for the public purse, which can be used to offset some of the harms caused by alcohol.”