Petition against the Small Brewers Relief reduction

[Chris17]

I wrote to my MP regarding this just over a couple of weeks ago. I'm yet to receive a response. This is the first time I've ever written to my MP, do any of you guys know if I should expect a response and if I don't get one, should I chase him up?

 

[Avo]

Singed

 

[jceg316]

If you're between 5,000hl and 30,000hl, you still get the benefit of the 50% relief on the first 5,000hl

From what I understand (and maybe @Hoddy can confirm or deny) it's a cliff edge. So as soon as a brewer makes 1 litre over 5000 HL they pay 25% reduced duty rates on all production. The system does have some flaws and SIBA has advised on a new system which promoted growth for all brewer

 

[-Bezza-]

From what I understand (and maybe @Hoddy can confirm or deny) it's a cliff edge. So as soon as a brewer makes 1 litre over 5000 HL they pay 25% reduced duty rates on all production. The system does have some flaws and SIBA has advised on a new system which promoted growth for all brewer

At the risk of involving myself in the detail of something I know nothing about, this is from Excise Notice 226:

If the production figure is not more than 5,000 hectolitres, the reduced rate is 50% of the standard rate. Where the reduced rate results in part pennies, it must always be rounded up to the nearest penny.

If the production figure exceeds 5,000 hectolitres but does not exceed 30,000 hectolitres, you’ll need to calculate the reduced rate using the following formula:

GP - 2,500 (hectolitres) × the standard rate
GP

Where GP = the actual or deemed production in the previous calendar year (or the current year’s estimated production for brewers who only started production in the current year).

For example, if you produced or were deemed to have produced 7,569 hectolitres of small brewery beer in the previous calendar year (or current years estimated production for brewers who only started production in the current year). If the standard rate of duty is £19.08, your reduced rate would be calculated as follows:

7,569 - 2,500 × 19.08 = a reduced rate of £12.78
7,569

Your duty rate in the current calendar year would, therefore, be £12.78.

So having re-read this, there is a cliff edge effect as you only deduct 2,500hl rather than the full 5,000. So that one additional litre effectively results in back-paying duty on half of your previous production.

That said, reducing the levels and smoothing the curve is likely to have a similar answer, only introducing the duty to those below 5,000hl too.

I would be interested to understand how the reforms result in larger breweries paying less duty.

 

[Hoddy]

Serious question. Would it be in Wetherspoons interest for it to succeed?

in short no as he feeds off of volume sales breweries that have economies of scale so he can hoover up discount cask beer to sell for pittance.

 

[Hoddy]

At the risk of involving myself in the detail of something I know nothing about, this is from Excise Notice 226:



So having re-read this, there is a cliff edge effect as you only deduct 2,500hl rather than the full 5,000. So that one additional litre effectively results in back-paying duty on half of your previous production.

That said, reducing the levels and smoothing the curve is likely to have a similar answer, only introducing the duty to those below 5,000hl too.

I would be interested to understand how the reforms result in larger breweries paying less duty.

So the "argument" that the larger regional brewers have is that the micros have a financial competitive advantage over them as they get little to no relief. However when you look at the economies of scale that they enjoy, Timmy taylor, Hogs Back, marstons etc the playing field is pretty level. You can see allot more information here Beer Nouveau

There is however an argument that the current "cliff edge" at 5,000 hcl could hold back growth. And to a point you can argue that it does. However, as some have pointed out lowering the point at which it starts, and then tapering it upwards DOES NOT encourage growth. If anything it actually discourages growth beyond the proposed 2,100 because actually at that size you are still pretty small and you do not enjoy much economies of scale at all. So that decrease in relief is quite painful.

Essentially by lowering the 50% relief threshold plays into the hands of the macro brewers as it introduces additional costs to the 150 breweries that are taking thier market share. This coming into affect (it doesnt have to yet if we can lobby that it is grossly unjust) making them a target for buy outs or likely to not survive under the higher taxation from HMRC. It also then increases the barrier to entry and then holds any new breweries coming through to rise up and fill the capacity that is left from those 150 closing. And hence that volume is then swallow up by the macro breweries because they have teh volume and scale to grab that space back with dull brown beer. Where i might also add, that the macros actually gain NOTHING from the proposed changes in SBR relief. All they do gain is squashing the competition to gain market share back by essentially reducing choice.

 

[Old Geezer]

I wrote to my MP regarding this just over a couple of weeks ago. I'm yet to receive a response. This is the first time I've ever written to my MP, do any of you guys know if I should expect a response and if I don't get one, should I chase him up?

Yes you most certainly should get a response and if you don't rip him off a piece of your mind remind the over-privileged parasite that he or she is working for you and you expect them to do their job which doesn't include propping up a bar (even the vastly over subsidised bars and restaurants in Westminster) or inspecting every golf club within a hundred mile radius.

Unless of course, they are a Labour MP in which case you can be assured they are diligently applying themselves to your wellbeing and concerns and will most certainly get a response as soon as they can.

 

[-Bezza-]

So the "argument" that the larger regional brewers have is that the micros have a financial competitive advantage over them as they get little to no relief.

Whilst I agree with everything you're saying above, this is the comment that stands out most. This is the very reason for introducing the relief, i.e. to help out the smaller brewers, so to argue this is unfair is just going back to square one.

I needn't tell you how much is annoys me that Hog's Back are caught up in this.

 

[Hoddy]

Whilst I agree with everything you're saying above, this is the comment that stands out most. This is the very reason for introducing the relief, i.e. to help out the smaller brewers, so to argue this is unfair is just going back to square one.

I needn't tell you how much is annoys me that Hog's Back are caught up in this.

I know it is shocking.

You can read the "response" or like i call it. Clever words by a PR company where they are trying the call the victim here Statement from Hogs Back Brewery on Small Brewers Relief Review - Hogsback

I think this bit says it all "the maths would indicate that a smoothly tapered curve will make a difference of some small brewers losing and others gaining 2-3 pence a pint of duty relief. This seems a worthwhile change if it leads to a fairer system"

Bascily its ok to throw 150 breweries under the bus if it means the price per cask goes up to benefit you.

 

[jceg316]

At the risk of involving myself in the detail of something I know nothing about, this is from Excise Notice 226:



So having re-read this, there is a cliff edge effect as you only deduct 2,500hl rather than the full 5,000. So that one additional litre effectively results in back-paying duty on half of your previous production.

That said, reducing the levels and smoothing the curve is likely to have a similar answer, only introducing the duty to those below 5,000hl too.

I would be interested to understand how the reforms result in larger breweries paying less duty.

Ah ok, I understand now. Still seems like a strange way to do it instead of a progressive taxation.

 

[-Bezza-]

Ah ok, I understand now. Still seems like a strange way to do it instead of a progressive taxation.

https://www.rossmartin.co.uk/tax-guides/4693-small-brewer-s-relief
Apparently it's an EU thing - the EU Directive provides for a maximum of 50% relief up to 200,000hl. The UK just decided to only apply the relief up to 60,000hl and in a roundabout way.

But I guess if they're going to change it and we're no longer bound by EU law, why not just exempt the first 60,000hl for everyone?

Or perhaps we call all petition the government to get lower earners to pay more tax because it's unfair on higher earners?

 

[Hoddy]

Jack who I know and have met managed to get it covered on the news. Here’s the interview.

https://www.itv.com/news/london/202...ke-leaves-small-breweries-with-a-bitter-taste

 

[-Bezza-]

Signed. And boycotting.

 

[Mrhandsome]

You son of a bitch, I'm in.

 

[531Man]

Signed,
Now:
20672 signatures.
Still needs a lot more - How can we make this viral?
Do CAMRA know/are they doing something about it?
Moderators?

 

[Hoddy]

Signed,
Now:
20672 signatures.
Still needs a lot more - How can we make this viral?
Do CAMRA know/are they doing something about it?
Moderators?

You just have to share it with everyone you know with the threat of "you will have to drink boring brown beer if this goes through" if you don't sign the petition.

And if you do like boring brown beer.........i disown you!

 

[531Man]

OK, Hoddy
I will contact with the link all my non-boring brown beer drinking buddies to sign, and hopefully pyramid-on.
Regards,
Robin.

 

[Jordang]

Signed and shared. Another cut into fair competition from the big boys