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UK Budget: Alcohol Duty

The Chancellor of the Exchequor has stuck to the alcohol duty escalator announced in the 2008 budget, and increased duty on most alcoholic drinks by 2% above the rate of inflation. The exception to this is cider, on which duty has been increased by 10% above the rate of inflation. With inflation at 3%, this means increases of 5% and 13% respectively. The new rates come into effect on 29th March 2010.

Historically, cider has had very low rates of duty, relative to other drinks. In 2009, the duty on a pint of cider (5% abv) was 18p. For a pint of beer the same strength, the duty was more than twice as much, at 47p. From next month, the duty for that pint of cider will be 20p and for the beer, 49p, still more than twice as much.

Duty rates for 2009 and 2001, for a selection of drinks, together with more examples of how this will apply to a bottle or a pint of each drink, are available here.

An extract from the official announcement is reproduced below.

Alcohol duties 2009-10 2010-11
Rate £ per litre of pure alchol
Spirits 22.64 23.80
Spirits-based RTDs (ready to drink) 22.64 23.80
Wine and made-wine exceeding 22% abv. 22.64 23.80
Beer 16.47 17.32
Rate £ per hectolitre of product
Still cider and perry exceeding 1.2% - not exceeding 7.5% abv. 31.83 36.01
Still cider and perry exceeding 7.5% - less than 8.5% abv. 47.77 54.04
Sparkling cider and perry exceeding 1.2% - not exceeding 5.5% abv. 31.83 36.01
Sparkling cider and perry exceeding 5.5% - less than 8.5% abv. 207.20 217.83
Wine and made-wine exceeding 1.2% - not exceeding 4% abv. 65.94 69.32
Wine and made-wine exceeding 4% - not exceeding 5.5% abv. 90.68 95.33
Still wine and made-wine exceeding 5.5% - not exceeding 15% abv. 214.02 225.00
Wine and made-wine exceeding 15% - not exceeding 22% abv. 285.33 299.97
Sparkling wine and made-wine exceeding 5.5% - less than 8.5% abv. 207.20 217.83
Sparkling wine and made-wine exceeding 8.5% - not exceeding 15% abv. 274.13 288.20