As part of its plan for growth, the government has published its response to the alcohol duty consultation launched in October 2021, along with draft legislation and explanatory notes.

Under the proposed changes, alcoholic beverages will generally be taxed based on the amount of alcohol they contain. Previously, different types of alcohol were taxed at different rates.

The reforms are intended to improve the current system by making it simpler, more economically rational and less administratively burdensome on businesses. They will take effect from 1 August 2023.

Draught relief will mean lower duty rates for certain draught products sold ‘on-trade’, in pubs, bars and restaurants. Small producer relief will extend the relief currently offered to small brewers to small producers of lower-strength beers, ciders, wines and spirits.

To provide additional support to the sector and help consumers with the cost of living, the government is also freezing alcohol duty rates from 1 February 2023. These rates had previously been set to rise in line with the retail price index.