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Taxation: Alcohol

My honourable friend the Economic Secretary to the Treasury (Justine Greening) has today issued the following Written Ministerial Statement. I am today publishing further information about potential tax measures following the review of alcohol taxation. I am making this update available on the HM Treasury website and a copy has been placed in the House Libraries. These measures are part of the wider government action to tackle problem drinking due to be announced this week by the Secretary of State for Health (Andrew Lansley) and the Secretary of State for the Home Department (Theresa May). The Government recognise that in some areas taxation can have a role in helping to address the harms associated with problem drinking. For example, a change to the definition of cider has already been made resulting in increased duty on cheap, strong ciders strongly associated with public health concerns. To complement this change, the Government intend to introduce a new additional duty on beers over 7.5 per cent abv (alcohol by volume) in strength. This will help to address the consumption of cheap, ““super-strength”” lagers that are also associated with high, and dangerous, levels of alcohol consumption. Changes will also be made to introduce a reduced rate of duty on beers produced at an alcoholic strength of 2.8 per cent abv or below. This measure will help to encourage the production and consumption of lower-strength beers and give responsible drinkers additional choice. These measures will continue to be developed with a final announcement made at Budget 2011. Draft Finance Bill clauses will be published alongside other Finance Bill measures on 9 December 2011, as announced recently by the Exchequer Secretary to the Treasury (Mr David Gauke)¹. There are no further changes to the structure of the duty on alcohol as a result of this review. Decisions about duty rates remain a matter for the Chancellor at the Budget. The Treasury will continue to engage with industry and other interested groups ahead of the Budget. "¹ Official Report (HoC), 9 November 2011, col. 10WS."