The alcohol production and sales sector in York and wider area has hit out at government duty changes, which officially came into effect this month.

The government says its changes, with duties based more on the alcohol content of a drink, rather than its type will be fairer, with a new relief for sales in pubs.

But even the supposed ‘gainers’ are largely unhappy, warning it will deliver weaker and less interesting beer.

York publican and co-founder of York Gin, Paul Crossman, is also chair of the Campaign for Pubs, and has spent more than a decade supporting independent businesses and reform for the sector.

York Press: Paul Crossman in The Swan

Paul says that despite the government saying Brexit has given it more freedom to sets its duty rates, this was always the case, which is why UK rates are ‘vastly higher’ than most EU member countries.

The latest changes, he says, will make little difference, if any to pubs or gin producers like York Gin, who face a raft of other cost increases.

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Duty for pubs, he says, has not gone down, just frozen, while duty rises have been imposed on off-licence and supermarket sales.

The smallest brewers may see some benefit but largest will benefit the most, with them keeping hold of duty savings rather than passing them on to their buyers.

Many larger breweries, he says, are cutting the strength of some of their beers to save on duty and increase their margins.

For York Gin, Paul says there was ‘nothing’ in the changes that will benefit his business. The duty on his 42.5% abv bottles of gin will increase 10.1%, around 83p before VAT.

“We intend to absorb this increase into our current retail price, but many other small producers will struggle to do so because throughout the sector margins are already squeezed by most other costs which have rocketed, particularly since Brexit, Covid and the recent energy cost crisis,” he added.

Wayne Smith, co-founder of Brew York, says despite the ‘government spin’, the changes are not good for both consumers and producers.

York Press:

The duty on beer has risen by a tenth, with further changes also on strength. Less tax on low strength beer below 3.5% will see the largest breweries drop the strength of their biggest sellers to 3.4%, saving tens of millions in duty. But he doubts any savings will be passed on to the publican or the drinker.

By contrast, Brew York, he says, is releasing 3.4% abv beers, such as Fennec Blonde and Calmer Chameleon Pale, where he has passed on the savings, which he hopes the pub drinker will see too.

However, Wayne warns the strongest beers, above 8.5% abv no longer has any duty relief. This means a 10% imperial stout now attracts duty of £1.62 a pint- three time the cost of the raw materials to make it.

Tax relief allowed breweries to be creative with styles and flavour, creating beers to be sip and savoured like a fine wine. But the duty change will see fewer interesting beers.

Wayne added: “We have almost 100 barrels of different imperial beers ageing in wood, which will now attract this higher tax rate. As such we are going to have to be much more selective about how often we release beers and in what volume, as they will be much less affordable now, even as a rare gift / luxury indulgence.”