Duty from alcohol could give Treasury £100m shortfall

By Richard Siddle

Published: 05 July, 2013

Duty levels collected from alcohol fell for the first time on the previous year, and the Treasury could face a further £100 million shortfall for the year ahead, according to figures released by the Wilson Drinks Report.

Total duty for the year to April 2013 brought in £10.14 billion to the Tresury compared to £10.18 billion for the same time period in 2012. The biggest drop in duty came from beer which fell by £179m.

Tim Wilson, managing director of the WDR, said the figures could have repercussions on the trade with further larger increases in alcohol duties to compensate.

He said: ""We have been highlighting the dangers of increasing duty during a period of falling volumes for some time. The big risk for Chancellor Osborne is that wines and spirits will follow beer and cider and fall into a cycle of decreasing duty receipts."

Wilson added :"The latest forecast from the Office for Budget Responsibility in March 2013 predicted that total alcohol duty for 2013/14 will be £10.1 billion. However, we expect that the decrease in duty receipts will continue at a similar rate for the remainder of 2013/14 which could lead to a duty shortfall of at least £100m for the year."

"The big risk is that wines and spirits will follow beer and cider and fall into a cycle of decreasing duty receipts. We expect that the decrease in duty receipts will continue at a similar rate for the remainder of 2013/2014 which could lead to a duty shortfall of at least £100m for the year."

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