This article is from the February 2013 issue of Total Politics
The Kirkcaldy Beer Duties Act 1741 was one of the earlier modern-day pieces of legislation to tax the brewing of British beer. All beer brewed and traded in Kirkcaldy was levied at two Scots pennies per Scots pint, or around three normal pints to you and me. The mark of the problem was in the measures, clearly.
Appropriately, it was a notable son of Kirkcaldy, Gordon Brown, who presided over the recently historic tax hikes on the nation’s tipple. Beer duty is 60 per cent higher than it was in 2004.
Great British beer-backing parliamentarians want the government to scrap the inflation-busting ‘beer duty escalator’ that is driving pubs to the wall, yet in a debate in November, the Treasury minister Sajid Javid admitted the tax was too lucrative, as it was projected to yield over £100m over the next two years. Hardly small beer when times are tough, goes the line.
It was also the line of the chancellor in 1895, Sir William Vernon Harcourt (Lib, Derby), with Britain facing “an estimated deficit of about £300,000” (£32bn today). An extra sixpence on a barrel of beer (roughly £2 on a pint today) would yield £500,000 (now £54bn), so wiping out the nation’s deficit with surplus to spare. Britain would drink its way out of the mire.
George Goschen (Con, St George’s Hanover Square), a former chancellor, congratulated his successor on “the most orthodox practice” and confined himself to quibbling about whether fewer people had died annually since the introduction of death duties – history shows that people will do anything to get out of paying taxes.
The backbenches were filled with displeasure. Arthur Jeffreys (Con, Basingstoke) decried the decision to reduce the duty on spirits, “which were made chiefly in Scotland and Ireland”, yet increase the duty on beer, “almost exclusively an English product”. Donald MacGregor (Lib, Inverness-shire) however, thought it a marvellous idea, alleviating an “indefensible disproportion” of tax on Scottish whisky.
Edward Heneage (Lib Unionist, Grimsby) said the duty would force brewers to shop for cheaper raw materials abroad. Sir William Cuthbert Quilter (Lib Unionist, Sudbury) had introduced a private member’s bill 10 years previously on the subject of purer beer, and, like a proper pub bore, could not resist butting in. “This extra beer duty was paid out of the pockets of the agriculturalists”, and feared “the brewer would seek other ingredients”. The real ale would suffer.
Sir George Trout Bartley (Con, Islington North), a temperance campaigner, deplored the regressive move “because beer was a much more wholesome drink for the masses than spirits”.
Everywhere in the annals of British political history, alcohol tax has always been a magnet for chancellors in need of a few pennies. Yet despite the present pains, brewers and publicans might be thankful for this silver lining: at least Osborne doesn’t see beer duty as the sole answer to our economic malaise.