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MPs to hear duty fears today

Published:  26 February, 2009

A top government committee examining the impact of tax changes on the UK drinks industry will hear oral submissions from the the trade's main bodies today as part of a wide-ranging inquiry.

The influential All Party Parliamentary Group on Wine and Spirits is inviting submissions from the UK drinks trade on what impact the increases in duty excise rates has on the sector. Today's public meeting in Westminster will hear the concerns of some of the trade's top representatives, including the Wine and Spirits Trade Association (WSTA)

The parliamentary group will also investigate the prospective impact of further tax rises scheduled by the alcohol tax escalator that will increase taxes by 2% above the rate of inflation for the next four years.Taken together it will see excise duty increase by as much as 40% by 2012.

Noticeably the committee will also investigate what impact the tax increases are having on Treasury revenues. Figures from HM Revenue and Customs suggest the Treasury is failing to meet its forecast revenue from excise duty on alcohol. From April to September 2008, HMRC revenue missed government targets by £137 million pounds. 

The committee recognises the wine sector is already having to cut jobs and 
wants to assess the role of tax hikes within this. 

The meeting takes place in the Wilson Room in Portcullis House, Westminster. 

The All-Party Committee hopes to be able report back on its findings sometime in March.

The inquiry will be co-chaired by Andrew Dismore MP and Geoffrey Clifton-Brown MP. The key questions to be examined include:

? What impact have tax increases had on employment in the wine and spirits industry?
? What impact have tax increases had on Government revenue? Will the tax escalator cause an increase or decrease in revenues?
? What impact have tax increases had on the prospect for future investment by the wine and spirits industry in the UK?
? What impact have tax increases had on consumer behaviour, choice and enjoyment?