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British pubs and brewers call for 'fairer' alcohol tax system

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The government could spur the creation of around 30,000 new jobs if it reformed the alcohol tax system, according to new research published yesterday by the British Beer and Pub Association (BBPA).

The authors of the study argue that the current UK tax system discourages the consumption of lower-strength drinks such as bitter, which is overwhelmingly UK-produced, in favour of higher-alcohol drinks like vodka and lager, which is largely made overseas.

The research shows that at present one unit of beer costs 42p on average, compared to 37p for vodka, 38p for gin, and 33p for cider.

The researchers looked at the impact on the UK economy of moving to a alcohol tax system more in line with Ireland, where the duty rate for difference types of drinks increases more significantly with strength.

In addition to creating around 30,000 new jobs, the change in approach would bring in around £250 million in extra revenues from employment taxes and corporation tax.

Announcing the results of the study, BBPA Chief Executive Brigid Simmonds said: "The new Government now has a great opportunity to bring fairness into our duty system -- with huge potential benefits for the Treasury and the UK economy.

"A fair deal for beer would create a win-win situation for all. Beer is unique among the main categories of drink, with Britain's pubs dependent on beer sales. Over 90% of the beer consumed here is brewed here.

"We've had many years of duty changes that have favoured other categories of drink -- yet taxing beer fairly would create thousands of new jobs, and substantial extra tax revenues. Beer is also a low alcohol drink of choice and should be treated differently to other stronger alcoholic beverages. There is potential for a huge success story that could be grasped by the new Government. Everyone would benefit from a new and fair approach."

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