Alcohol duty increase 'sickening' for pub industry in NI

The biggest single alcohol duty increase in almost 50 years could have a devastating impact on the pub industry, a businessman in County Down has said.

From Tuesday a new system comes into effect which will mean alcohol products are taxed according to strength, rather than categories.

Hospitality Ulster warned it could mean prices were passed on to customers.

Alcohol duty rates had remained frozen since 2020.

Jody Waterworth, from Pier 36 Bar and Restaurant in Donaghadee, said the changes were "sickening".

"It's becoming increasingly difficult to mitigate and keep costs down - everything is going up - there's only so much we can ask of our customers," he told BBC News NI.

Under the changes, announced in the 2023 Spring Budget, prices will rise in line with the retail price index (RPI) for all products both made in the UK and imported.

The government outlined that there would be no duty increase for a 4% alcohol by volume (ABV) pint of draught beer.

However, the tax would be 3p higher for a 40% ABV 25ml serving of whisky, and 5p higher for a 250ml glass of still wine with a ABV of 11%.

Colin Neill says hospitality businesses have no choice but to pass the costs to customers

Colin Neill, the chief executive of the trade body Hospitality Ulster, said significant increases in duty on alcohol were "bad news for customers" as businesses may have to pass on the costs in price increases.

He said that could cause misery for customers and damage to business.

"This has left hospitality businesses - who are fighting to break even - no choice but to pass on the significant duty increases to customers," he said.

"Instead of providing relief in a period of much need the government continues to exacerbate the sector's struggle."

'Disposable income squeezed'

Mr Waterworth said hospitality businesses such as his bar and restaurant were struggling and the change could make matters worse.

"The impact on our industry is devastating, a major concern for us is our customers and the fact their disposable income is already getting squeezed - this will make things even worse," he added.

"They are attacking an industry that's already on its knees, they should be trying to reduce VAT and tax - I think it's an outrage."

Chancellor Jeremy Hunt said the switch in how duty would be calculated would help "the great British pub".

In a statement HMRC said the new alcohol tax pricing system would "make the system fairer and responsive to new products entering the market as consumer tastes evolve."