Cider industry saddened by a far from rosy Budget battering
The cider industry took a battering in the Chancellor’s March Budget and warned the decision will threaten the health of several British businesses.
Cider, like the rest of the alcoholic drinks market, was hit with a duty increase in line with inflation, while “white cider” was also singled out amid plans to introduce a new duty band.
Fenella Tyler, chief executive of the National Association of Cidermakers, said: “It is disappointing that despite the challenging conditions facing cider makers in the UK, the Chancellor has been unable to respond to the cider industry’s concerns and has increased cider duty rates in line with inflation. The cider market is facing some difficult challenges and a 3.9% increase in excise duty will inevitably impact on our efforts to return cider to growth.
“We are also concerned that the Chancellor has singled out cider for a separate consultation on duty bands. We look forward to working with the Treasury to ensure that any proposed changes reflect on how this could affect the total cider market as the majority of small, medium and large cider makers across the UK operate in this area.
“Whatever their scale, they will have to carry the additional cost of higher excise duty if new measures are introduced or cover the cost of new recipes and packaging changes. Alongside the duty increase, this puts even more pressure on businesses that are feeling the strain of a cider market that is in long term decline.”
Gordon Johncox, managing director of Frosty Jacks supplier Aston Manor Cider, said he was “surprised” by plans to consult on a new duty rate to target “white cider”.
“We often point to the inaccurate mythology that exists around white cider and we are disappointed that without evidence this announcement has been made,” he said. “It is perhaps the first time a Chancellor has signalled the intent to use tax to address a public policy concern on alcohol.
“It is a very blunt instrument to support the flawed logic around how whole population measures might address the circumstances that prompt a minority of people to misuse a range of substances.
“We will participate fully in the consultation process and provide evidence that dispels the myths that exist and point to the views of relevant professionals that progress is only made when the focus is on the individual in crisis and not the substances they might misuse.”
The burgeoning English wine industry also expressed its disappointment that it was not given a better deal at a time when Brexit should be pushing British products to the fore.
Simon Robinson, chairman at English Wine Producers, said: “It is very disappointing that yet again the wine sector has been hit by what amounts to a real-terms increase in duty, ignoring the pleas from the UK wine industry, as a fast-growing sector, and the wider wine trade that higher taxes are damaging trade and hitting the UK wine consumer.
“The UK wine industry will be focussing on duty issues over the coming months to look at this in more detail and to discuss further with Government. This will include matters such as equalizing duty on still and sparkling wines as well as focusing on the opportunities that lower duty could have on our industry in a post-Brexit world.”