The government is facing a backlash over its budget plans to offer a 3p-a-pint cut in beer duty as small craft brewers fear they will not qualify.
Rishi Sunak on Wednesday said that rates for draught beer and cider will be cut by 5%, taking 3p off a pint in a pub, in a policy he dubbed “draught relief”.
But the proposal – part of a huge overhaul of the UK’s alcohol duty system – faced criticism for only being offered to breweries using containers of more than 40 litres. Industry figures said the move will make little difference to micro-breweries that typically use 30 litre kegs.
What’s more, the chancellor and Boris Johnson took part in a photo-op where the pair were pictured hauling 30 litre kegs around a south London brewery.
The botch was spotted by a BBC reporter – and the Campaign for Pubs seized on what it described as “direct discrimination against UK small brewers”.
Tom Bott, director at East London brewery Signature Brew, said it was a “mistake” by the Treasury to apply the tax reduction only to draughts from containers over 40 litres.
“The vast majority of the draft beer community sell kegs in 30 litre containers; it therefore excludes a huge portion of the industry and in my opinion the most exciting portion,” Bott told the PA News agency.
A Treasury source indicated that the proposal was intended for most draught beer for sale in pubs to qualify, including where it is made by smaller or craft brewers. The department is consulting with the industry over the best way to achieve that, they said. Anger was, however, palpable on social media.
Glad we just ordered all those 30L steels ??Nice work Rishi, spent plent of time consulting with industry about this eh? https://t.co/Wd87HaTqv4
— Iron Pier Brewery (@ironpierbeer) October 27, 2021
Paul Jones, who owns the independent Cloudwater brewery in Manchester, tweeted that he was “absolutely furious at this point”.
He said: “This smacks of another budget in favour of the largest companies, with the whole craft sector left hanging without details of duty changes. They’re setting us up for a battle of the deepest pockets.”
The Society of Independent Brewers said it would continue to campaign for relief to be applied to containers of more than 20 litres. Chief executive James Calder, said: “We look forward to working with the Treasury as they implement this landmark policy.
“Whilst hugely beneficial for producers of ‘real ale’, which is sold in 40 litre casks, most craft keg beer in the UK is sold in 30 litre kegs, meaning they cannot benefit.
“By amending this lower threshold to 20 litres the Treasury can ensure all independent breweries benefit from this welcome new duty relief on draught beer.”
