Upcoming changes to alcohol duty could raise an additional £3 billion by 2027, according to the Office for Budget Responsibility (OBR).

Announced as part of Chancellor Jeremy Hunt's Spring Statement, the new alcohol duty system will come into effect on 1 August 2023.

Dubbed the "biggest alcohol duty reforms in 140 years" by the Government, the system will tax drinks based on alcohol by volume (ABV).

As a result, a typical glass of red wine could cost around 11p more on average, while a pint of beer could cost 3p less.

The OBR expects the changes to raise £12.4bn in alcohol duties in 2022/23, raising each year to £15.8bn in 2027/28, the final year of its projections.

A new draught duty, which reduces rates on qualifying products sold in pubs and restaurants, will allow hospitality businesses to pay less duty on certain alcoholic drinks compared to retailers.

Jonathan Athow, director general of customer strategy & tax design at HMRC, said:

"The new alcohol duty system will be based on the founding principle of taxing alcoholic products by strength, ensuring consistency across the board for the first time.

"The system will support the Government's public health objectives and provide extra support to small producers, pubs and the hospitality sector."

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