Why Reuben is Right. About some things

This post was written by Jacob on March 25, 2010
Posted Under: Drinking

I’m sure that today’s budget will be chewed over in the blogosphere pretty heavily over the next few days. I shan’t dwell on all the details. Not enough being done too late. We all agree. The government pushing this weird thing of high tech industries in their realisation that since Thatcher we’ve been kept afloat by meaningless financial products etc etc. What I do want to dwell on, though, is the increase on duty on cider.

Of course, over the last few years cider has become a far more popular drinks. The expansion of high end brands retailing at a premium, such as Magners and Bulmers have led to some sort of cider-gentrification, but nonetheless it has remained a relatively cheap way of drinking, and one that has been favoured, as a result, by many poorer people and young people. Reuben, one of our bloggers here on The Third Estate saw all of this coming. He has told us over and over again in the last year that the sort of taxes on cheap booze are effectively a way of the government allowing drinking for the rich but not for the poor, and today he was proved right with a 10% duty increase on cider.

The underlying spirit of this change is actually to do with prohibition, about the government feeling that it is their duty to protect people from themselves (only poor people, mind), but in doing so they undermine a much wider section of the population than alcoholics. Rather, all of those people living on low wages or low benefits, who like a drink every now and again and choose to drink cider are being priced out of the market. Yes, there are people with alcoholism problems in this country, and yes many of them are amongst the poorest members of society (note, there is an issue of cause and effect here! It is not because people are of some underlying morally dubious self-destructive character that people become alcoholics and are also poor, rather poverty is very much a cause of people turning to alcoholism) But the solution can never be prohibition by stealth.

Reuben has been right all along, and it should not be up to the poorest members of our society, taking pleasure in some of the few luxuries they enjoy, to pay back money that has been stolen from them by banks and financial corporations.

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Reader Comments

Whilst I basically agree that we need to avoid these kinds of regressive taxes on the poor, I think the issue with smoking in particular, and less so although still applicable to alcohol, is somewhat moot. Whilst these new taxes will undoubtedly hit the less well off the hardest, their relevance as regressive taxes pales in comparison to the likes of 17.5% VAT – something I’d like to see abolished altogether – and income tax on incomes of less than £20,000 (the precision of what what be an appropriate rate to start taxing income is academic, I’m simply pointing out I believe it’s currently far too low).

So whilst I essentially agree that the the poor should not be targeted in this way, I think there are definitely more effective ways of improving people’s lot than cutting alcohol and tobacco duties.

#1 
Written By Mark Anthony on March 25th, 2010 @ 10:16 am
Rob Jones

I agree with the sentiment here, but I think it’s misplaced. If Labour were doing this with the ethos of pricing people out of cheap cider, they’d have said so. They’d have made a great big fixing-broken-Britain song and dance about it. Also, a 10% increase in duty doesn’t ammount to the kind of significant increase in real cost that would stop cider drinkers being cider drinkers, and the govnt know this – that’s why all discussion about pricing people out of binge drinking has revolved around minimum price per unit laws, not tax increases.

The reason that’s been given by Darling for the increase makes alot of sense, and he may actually (shock horror) be telling the truth. Cider duty, unlike other alchohol duties, has been frozen for the past five years or so, and was decreased slightly at the start of that period. This was to encourage a resurgence in the british cider industry, which it did. Now, the government are faced with trying to raise funds without increasing the massive deficit that they have been so roundly criticised for. So, in Darling’s words, they “corrected an anomaly”. It’s a small drop of extra cash in an ocean of government spending, sure, but as Tesco put it, in capitalism, every little helps.

The real issue is whether this will substantially impact our prosperous local cider industry in already adverse economic circumstances, which remains to be seen. Now cider has established itself as a much more mainstream drink over the last decade or so (think addlestones, bulmers, magners) I tend to think it will retain that market, as it can still be priced competetively with lager.

Labour have never claimed this was an anti-binge-drinking measure, lots of other people have just assumed it was.

#2 
Written By Rob Jones on March 25th, 2010 @ 12:06 pm
Paul B

I agree with Rob.

“The underlying spirit of this change is actually to do with prohibition, about the government feeling that it is their duty to protect people from themselves”

No, it’s not. The underlying spirit is increasing tax revenue by increasing taxes in a way that can be seen as inconsistent. Criticising Labour for taxes on cider and cigarettes rather misses the point – they’re making policy on what is possible and what is electable, without ever coming from any kind of base principles. This was typified by the moment at which Darling claimed the policy of cutting public spending was “not about ideology or dogma” – none of Labour’s policy has come from principle, it has come from perceived necessity and electability. Labour’s crime is not for making policy from the wrong principles, it’s from making policy without principles. That is why Alistair Darling was never going to heed your call yesterday.

#3 
Written By Paul B on March 25th, 2010 @ 8:56 pm
Roger Duffy

Am I right in thinking it’s 9p per litre? And (if the above posters are correct) that they’ve had a five year tax-freeze? Drink a litre a day (hypothetically, not a recommendation) and you’ll be down £39 this year. Not that bad, is it?

#4 
Written By Roger Duffy on March 26th, 2010 @ 12:34 am
asd

i reckon traditional urban cider drinkers are probably the least likely people in britain to turn up to a polling station… the gentrified cider drinkers are presumably all dyed in the wool tories, as well as the rustic-traditional cider drinkers

this is probably mandelson’s clever idea.. bravo!

#5 
Written By asd on March 26th, 2010 @ 1:02 pm
Michael

As a socialist consumer of Westons, Old Rosie, Thatchers, Frome Valley, Aspel, etc etc I must protest in the strongest possible terms.

Oo arr.

#6 
Written By Michael on March 26th, 2010 @ 2:37 pm

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