The government has been warned not to increase duty on alcohol amid speculation that the Chancellor may be considering another tax hike in the
emergency budget on June 22.
It has been reported that The Treasury is considering repeating the 5% increase in alcohol duty imposed in the March Budget.
The Association of Convenience Stores (ACS) said the move would only help fuel the illegal trade. ACS chief executive James Lowman commented: "The pressure of government to raise revenue is significant but a second alcohol duty hike in the same calendar year is not the answer. Every penny that prices increase pushes more consumers over to buying their products from illegal sources and so is likely to be counter-productive and damaging to legitimate licensed businesses.
"Duty increases are often seen as a politically justifiable option for a Chancellor seeking opportunities to increase revenue. However, such a move at this time would pre-empt and undermine the credibility of the Coalition Government’s commitment to a detailed look at the evidence surrounding alcohol price and taxation.”
"ACS is happy to play a constructive role in such a review, and to understand more clearly how restrictions or interventions will have a measurable impact on alcohol harm."
According to the ACS, the illegal trade in alcohol and cigarettes accounts for more than £5 billion in lost revenue to the Treasury and legitimate businesses.