Duty rises cause a drop in government receipts

Alcohol duty collected from the British government fell for the first time on the previous year according to the Wilson Drinks Report. Total duty for the year to April 2013 brought in £10.14 billion to the Treasury compared to £10.18 billion for the same time period in 2012. The biggest drop in duty came from beer which fell by £179m.

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, The Wilson Report predicts 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 £100m for the year.

Tim Wilson, managing director of the Wilson Drinks Report said they had 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.