Budget responses

23 March, 2011

The National Association of Cider Makers, Diageo and the ACS have reacted to the Budget announced this afternoon.

The National Association of Cider Makers, Diageo and the ACS have issued reactions to the Budget announced this afternoon.

Henry Chevallier, chair of the NACM, said the 2% rise would add around 2p to a pint of cider.

"Though not entirely unexpected this decision puts at risk the progress the industry has made in recent years to be more sustainable, to increase consumer choice, to address misuse and grow government revenues," Chevallier said.

"There are immediate deficit issues to address and that is understood. However, for an industry with an investment cycle measured in decades it is vital that we quickly return to a stable and sustainability duty regime. This will ensure that the cider industry can continue to again invest at a level that supports the rural economy and brings a return to growth for a very British success story."

A statement from Diageo said: "While we welcome the Chancellorís decision to introduce a reduced rate of duty for lower strength beers which should help to catalyse the further development of such products, we are disappointed he has chosen to proceed with the escalator.

"This means that alcohol duty will have risen by almost a third in the last three years. We recognise the economic challenges that the Chancellor faces; however, over 70% of the average retail price of a bottle of Gordonís Gin or Bellís Whisky now consists of tax. That is a staggering and unsustainable figure which is significantly higher than the equivalent tax proportion on an average litre price of unleaded fuel."

Meanwhile a statement from ACS chief executive James Lowman said: "The rise in tobacco duty will drive consumers away from legitimate retailers into a dangerous illegal trade which costs the taxpayer billions every year and already accounts for 20% of all tobacco consumed in the UK. This persistent policy of making UK tobacco more expensive than most other countries in Europe means we need a new and credible strategy for catching and deterring those selling cigarettes on our streets.

"We welcome the focus on retail growth in this Budget. Local shops are a weathervane of the recovery their success creates jobs and generate economic confidence within our communities.

"ACS welcomes the extension of small business rate relief for another year, however thousands of local shops serving community needs wonít benefit and we are disappointed that Government has not felt able to increase the thresholds for this relief."

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