By James Jeune

Copyright jerseyeveningpost

GOVERNMENT plans to introduce a lower rate of duty on beer, cider, wine and ready-to-drink cocktails – sold from large containers in pubs, restaurants and hotels – have drawn a mixed reaction from the hospitality sector’s representative body.

Jersey Hospitality Association co-chief executive Marcus Calvani said the planned tap relief was a “step in the right direction” but questioned whether consumers would notice the difference.

Following freezes in 2021, 2023 and 2025, the proposals include raising alcohol duty “in line with RPI growth” (2.6%).

However, plans to introduce tap relief would see a lower rate of duty on beer, cider, wine and ready-to-drink cocktails sold from large containers in pubs, restaurants and hotels.

The Budget states that the relief would be at a standard rate of 10% of duty charged on products dispensed from containers of ten litres or more, and 15% on products below 4.9% alcohol by volume “to incentivise responsible consumption”.

“Tap relief is an administratively simple approach used in other jurisdictions to benefit both businesses and consumers,” it added.

Mr Calvani said that, if duty was going to be raised, RPI was “probably the most acceptable thing to raise it to” as opposed to some of the hikes seen previously.

Commenting on the proposed tap relief, he said that while it “might seem to be a positive thing and a solution”, it had been tested in other jurisdictions and “hasn’t been particularly successful”.“It is so limited to, in this case, only products coming out of ten-litre or more containers, minus pure spirit,” he explained.

Mr Calvani also noted that there were a “huge number of establishments” in the Island that did not have draught systems, including some smaller operators that “just simply don’t have the space”.

Although he acknowledged the proposed relief as a “step in the right direction”, he also said that, in light of increased industry costs, a 10% or 15% discount on duty was “not going to have a significant enough impact to really see a significant change in the on and off-trade costs of alcohol to the end consumer”.

A spokesperson for Randalls said: “Athough duty represents a portion of a pint of a beer and not its total cost, it’s a step in the right direction to support Jersey’s wonderful and varied industry at a critical time, and we thank the ministers for seeing some of hospitality’s troubles and start addressing them before it’s too late.”

They added: “We hope it’ll help ease cost pressures across the supply chain and keep prices fair for the Jersey population while maintaining viability in a market still recovering from high cost rise in a short amount of time as well as shifting consumer habits.”