Drinkers and smokers face above-inflation tax rises on alcohol and cigarettes

Tax on most alcoholic drinks will rise by two per cent above inflation from midnight on Sunday. The average price of a pint of beer will increase by 2p, a bottle of wine by 10p and a bottle of spirits by 36p.

Cider drinkers were given the most punishing “vice tax” as the Chancellor unveiled a 10 per cent rise. The price of a 750ml bottle of sparkling cider will go up by 9p.

Mr Darling said the move addressed a “long-standing anomaly” whereby cider attracted less duty.

“Super-strength” ciders are to be redefined as made wine from September and subjected to an extra £2 per litre tax in an attempt to prevent alcohol abuse. The decision followed a Conservative plan to levy more tax on strong cider and beer to deter binge -drinking by teenagers.

The tax rises were criticised by the National Association of Cider Makers. The Wurzels, the West Country band who had a hit with I am a Cider Drinker, said in a statement that they were “very upset”.

Mr Darling announced that Labour’s “alcohol duty escalator”, which sets rises in drink duty above inflation, will continue until 2015, collecting a further £300 million. It had been due to end in 2012.

Drinks industry groups accused the Government of “piling misery” on beleaguered drinkers and pubs.

Brigid Simmonds, the chief executive of the British Beer and Pub Association, said Mr Darling had now increased tax on beer by 26 per cent since 2008, collecting £761 million while 4,000 pubs had closed. “This latest beer tax hike piles on the misery for Britain’s hard-pressed pubs and beer lovers,” she said.

“It is also a snub to voters, who by a majority of two to one wanted the Chancellor to scrap the beer tax escalator.”

Mike Benner, the chief executive of the Campaign for Real Ale, said: “Today’s Budget is a charter for the large supermarkets who irresponsibly promote alcohol as a loss leader at the expense of our nation’s community pubs, real ale and responsible pub goers.”

Mr Darling also announced that tobacco duty would increase by one per cent above inflation and then by two per cent each year until 2014. This means that the average price of a packet of 20 cigarettes will rise by 15p. It follows an 18p rise during the temporary VAT cut last year, which was not removed when VAT returned to its regular rate.

Deborah Arnott, the chief executive of Action on Smoking and Health, said: “Raising the price of tobacco is one of the most effective ways of reducing smoking.”

Producers claimed that the price rise would drive smokers to buy from smugglers who imported cheap cigarettes from eastern Europe illegally. It is estimated that one in seven cigarettes smoked is smuggled.

Christopher Ogden, the chief executive of the Tobacco Manufacturers’ Association, said: “On Jan 1 the Government imposed the largest tax increase on tobacco products in 10 years and now, less than three months later, taxes are to rise again.”

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