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Industry calls for alcohol duty suspension for at least six months

Published:  18 March, 2020

The Wine and Spirit Trade Association (WSTA) is calling on officials to urgently suspend all alcohol duty to ease the tax burden on beleaguered businesses ahead of next week’s deadline. 

Next week is due to be a crunch time for UK businesses as they gear up to pay their latest duty bill – the first of such bills since the government has escalated measures to deal with the spread of the coronavirus (Covid-19).

The UK’s wine and spirit sector has welcomed the government’s pledge to support the hospitality sector and to do “whatever it takes” to help during these extraordinary times, the WSTA said. 

But now they are calling on the government to “go further and faster” by agreeing to an immediate duty suspension, starting from next week for at least six months, which they say will save the UK wine and spirit sector an estimated £5.8 billion. 

“On 25 March UK wine and spirit companies will be landed with their duty bills, followed six days later on 31 March with their VAT demands,” WSTA chief executive Miles Beale, said.

“Swift government action to waive excise duty payments for at least six months, starting from next week, would have an immediate impact and can make a real difference. This would allow all hospitality businesses to keep back vital company cash and support their efforts to pay employees and stay afloat.” 

An immediate duty suspension is likely to be particularly welcomed by pubs and restaurants where on-trade sales of wines and spirits were worth £11.1 billion in 2019. 

These are facing the most “immediate threat” and for who the windfall would provide a “vital lifeline to help keep companies afloat and people in employment”.

The WSTA is also calling for urgent clarification on how business rates relief will be extended to the suppliers that support the UK’s pubs, bars and restaurants – businesses like Jascots Wine Merchants. 

“These are incredibly testing times, not just for our great British pubs, bars and restaurants but also for businesses like ours who supply them,” John Charnock, managing partner at Jascots, said. 

“We supply 100% to the on-trade and support a dedicated team of staff, each on above London living wage. The offer of a loan is not enough to help us survive. We need much more to ensure our future.”

Also, yesterday’s (March 17) announcement of a support package for the hospitality industry focused on loans for businesses, but did not address workers, the WSTA said. 

The on-trade now needs a “comprehensive employment package” at today’s briefing, which is needed “to support the lifeblood of the hospitality industry and those employed across the UK’s pubs, bars and restaurants”.