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Industry reacts to decision on beer duty with dismay

The beer industry has reacted to the  Chancellor’s decision to collect March’s Beer Duty payments with dismay.

Brewers have been calling on the Chancellor to unilaterally cancel the payment, due to be debited from bank accounts today, in the face of decimated sales following social distancing measures including pub, bar and restaurant closures and the closing of takeaway sales for beer businesses.

James Calder, SIBA Chief Executive said in response to this news: “SIBA has been calling for the cancellation of Beer Duty for over a week and it is incredibly disappointing that the Chancellor has decided not to act, given he knows how poor the answer rate and experience on the helpline is. The Chancellor has left brewers with few options if they are unsuccessful in reaching the helpline. There will be brewers tomorrow who will have thousands of pounds direct debited from their accounts by HMRC. This is a huge blow for the UK’s small independent brewers.”

In lieu of beer duty being cancelled brewers are being encouraged to phone the HMRC time to pay helpline, which HMRC say is now fully staffed, with options to speak specifically about excise duty, however a poll of small brewers by SIBA showed that only 21% have been able to successfully reach the helpline.

SIBA say the average small brewer will be landed with a beer duty bill of around £5,000, but for larger independent breweries in the UK it could be as much as £500,000.

Emma McClarkin, Chief Executive of the British Beer & Pub Association, said: “We urged the Chancellor to cancel the imminent Beer Duty bill, to allow businesses to use funds to invest in their survival. The decision not to act on duty is extremely disappointing. Make no mistake, this is a huge blow to Britain’s world class brewing industry that has been devastated in the last week.

“Cancelling the duty payment due on March 25th would have freed up cash for many hard-squeezed pub and brewing businesses, helping them get through this difficult period whilst saving jobs.

“Brewers are being encouraged to phone the HMRC’s helpline if they have concerns over paying their duty bill, but with answer rates on the helpline so low, it is a lottery as to those who get through and receive the additional support they need at this time.”

In response to the decision, CAMRA National Chairman Nik Antona said: “CAMRA is disappointed to hear that the Chancellor has decided not to cancel beer duty in light of the current COVID situation.

“This could have meant the difference between many hundreds of independent breweries standing a chance of surviving this crisis, or closing their operations permanently and never reopening.

“Many brewers were already faced with the difficult challenge of trying to continue to run their businesses and retain staff, in order to allow customers across the country enjoy great beer – one of the small pleasures still available to people.

“The postponement or cancellation of beer duty could have helped keep some of these small independent businesses open and trading online, rather than see thousands of pounds sent to HMRC.”

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