As most of you will be aware, the Government are changing the taxation on high ABV beers.
This piece was written on the Beermerchants blog and is posted here with their permission as we feel it’s of the highest import that everyone read it, thanks:
Today, in offices much like ours, Louise and Colin – people like Zak and his team, Nigel and Ian, Andreas or Steve, Bart Verhaege, then people like Nick and Duff, then Martin and Tom will all have dramatic tiered changes to make to their presentation, er, Offering.
Oddly, I guess there might be conversations in offices in Denmark or Northampton, perhaps whereverTennents is made, but more so in Cheshunt – life will carry on as normal.
The simple reason specialist beer importers, retailers and beer specialist venues will have to charge more, is because of a simple multiplier High Strength Beer Tax that comes into place today. Yes, that’s a tax for beers over and above 7.5% ABV – capturing in the same net dolphins and tuna – Chimay and Tennents Super; Stone Arrogant Bastard and Carlsbery Special. Beers with different origins and space on the shelves of various Retailers.
Why am I concerned, surely the reassuring tones of governmental research showed that you dear beer lover is less price senstive when purchasing High Strength Beer?
Ok, picture this: say a bottle of Chimay will go up 25p perhaps more. 75p at least by the time that hits the shelves of bars. 25p when in retail space, is the difference between two bottle buy and one. 75p, is the difference between a buy and no buy.
I believe the tax system that has been applied is a Pigovian tax ” The tax is intended to correct themarket outcome. In the presence of negative externalities, the social cost of a market activity is not covered by the private cost of the activity.” – now as you know, I am not the strongest writer in the camp; nor the most erudite – but the way I see it the simple reasoning behind the tax levy was to inhibit the purchase of super strength beer because of their links to antisocial behavior etc. What the papers would have called a Sin Tax.
Walking through Canterbury last night, after a tasting with some 80 people, students and academics and everyday folk all mixed together – tasting beers from 3.5% thru 11%. No issues, no trouble – save for a dodgy comedian; long story. Out in the town, many people drinking “continental style” – cafe sat, coffee, beer or wine all being consumed conscientiously. I saw a quite few people walking along with Tall Cans of “Mystery Lager”. I saw one pub with a raucous kick out happening – attended by a brand new Range Rover, unmarked with blue lights appearing from below the grills. Who were they “attending to”, middle-aged men. Sad. Thankfully they didn’t look like Craft Beer people. More statistics.
You’ll see from the opening paragraph that it was easy to name the family of beer-importer-retailers. There isn’t many of us. Specialist beer, be that Artisan, Craft, Craft Keg, Imported Bottle, Cask beer, Real Ale – what ever church you follow, it affects us all. It’s just more pronounced when your business, livelihood, wellbeing is tied to the sale of over – 7.5% beer. The internal effects of this, I know of at least 6 beers that are going to be capped at 7.4%. I know beers that will not be brewed again. I know of beers that will not be imported. I know that considerations have been very clearly stated to continental brewers that beers of 7.4% and above will not be given much push. Times are a changing. When was the last time you had a breadth of strong, rich, full flavoured massive beers in front of you… I look forward to seeing Dover Beer Festival this year, “the festival of 5% and above beers” – I don’t hold much hope for the range of biggest of the big beers.
So, if something is taken, something must be given? 2.8% and below, now are 50% off the Duty rate. As someone who championed 3% beer in cask, and has had long conversations with Eddie Gadd (who if you don’t know does a lot behind the scenes with SIBA); then brewed 2.8% called Low and Behold. it’s expensive brewing beers at 3%, ingredients that we don’t fully use, massive amounts of hops that compensate for the lack of body – few have mastered the style – perhaps Redemption Trinity is a master of this very small band of beers. Without checking Ratebeer or something, I would think there were more over 7.4% beers than sub 3% on the market in the UK
All price rises do not reflect the rise in the cost of life, expectations of wage increases and simple business costs. It’s going to be harder to sell 2 bottles of beer, rather than the one. Considering the cost of travel is always rising – when you get to the bottle shop, are you then going to have 1 or 2 bottles? you know the answer.
What were alternatives. Direct regulation? Did you know that Governments can choose to directly regulate things? Speed Limits? (oh noes that’s up for debate too) – wouldn’t have something like “you cannot sell alcohol below cost” although one wonders if invoices are easily fudged when selling to TESBURAS Or that TESBURAS political weight was just powerful enough to shift the onus from them?
See, we elect people in suits to go and do their best for the UK, both home and abroad. Make choices and decisions based on heartfelt instincts and research, insight, experience and knowledge…
Did they do the right thing?
have they fuck.
Welcome to Utah.