Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential impact of current levels of (a) alcohol duty and (b) VAT on the viability of pubs, breweries and hospitality businesses; and whether he has made an assessment of the potential merits of introducing reductions in those taxes to support the sector.

At Budget 2026, the Chancellor announced that Alcohol Duty rates will be kept constant in real terms by uprating in line with the Retail Prices Index (RPI) on 1 February 2027. Alcohol Duty was also previously uprated by RPI on 1 February 2026 and 1 February 2025. Uprating is a prudent decision for the public finances that balances the important contribution of alcohol producers, pubs and the wider hospitality sector with the tax’s role in supporting public health.

This Government is also proud to have been able to significantly expand the generosity of Draught Relief this parliament, in recognition of the economic and cultural importance of pubs, and the wider “on trade”.

Further information on the impacts of these Alcohol Duty measures can be found in the relevant Tax Information and Impact Notes.

VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. Exceptions to the standard rate are limited and must be balanced against their impact on the public finances.