Tax on alcohol may rise another 5%

Alcohol prices look set to rise again, as the Treasury considers increasing the tax on alcohol by another 5% in the emergency budget next week.

The price of alcohol has already increased this year, after the Labour government hiked alcohol duty by 5% in the March budget.

And with chancellor George Osborne also likely to increase VAT from 17.5% to 20% in the emergency budget, another alcohol tax rise could see the cost of beer, wine and spirits soar.

Since the beginning of 2008 the duty paid on wine and beer has already risen by 26%, and by 22% on spirits.

According to the British Beer and Pub Association (BBPA) around 40 pubs Britain are closing down every week as a result of expensive alcohol, the smoking ban and cheaper beer being sold in supermarkets.

The BBPA said: ‘A beer tax plus VAT increase would see the price of a pint rocket by 20 pence on the eve of England’s third group game against Slovenia on 23 June’.

‘Such a move would spell disaster for thousands of community pubs and for Britain’s brewing industry,’ BBPA added.