Autumn Budget Analysis 2024

In the Autumn Budget 2024 there were three key announcements:

1. Most alcohol duty rates will go up by RPI inflation in February 2025.
2. Draught Relief – part of the Reform of Alcohol Duty – will be increased.
3. Confirmation that the temporary wine duty ‘easement’ will end.

This is only the third time in a decade that most products’ duty rate has kept in line with inflation, as the Treasury and OBR assume will happen.

After the increase, alcohol duty will still be much lower than it was in 2012/13. In real terms:

• Beer duty will be 32% lower
• Draught beer duty will be 42% lower
• Cider and spirits duty will be 26% lower
• Draught cider duty will be 36% lower
• Wine duty will be 19% lower

Cumulatively, duty cuts will cost the Treasury over £28.6 billion from 2013-2030, compared with if duty had been raised in line with inflation as was planned.

Recommendations:

1. Raise alcohol duty above inflation each year, targeting off-trade alcohol.
2. The rates are set too low – they should at least cover the £27.4 billion cost of alcohol harm to society.
3. Cider is still being preferentially treated with lower rates than the same strength beer, which is likely to continue to cause harm. They should be equalised.