They say evil prospers when good men do nothing. And by doing very little today, the coalition has managed to upset almost everybody.
Retailers in England and Wales are to be banned from selling booze below the cost of duty plus VAT – a less than radical plan that effectively preserves the status quo for the supermarkets.
“After talking tough, the government has ducked a tough decision,” said James Lowman of the ACS. “Their final proposal will not curb aggressive supermarket discounts like many of those we saw over the Christmas period. Defining 'cost' as just tax is neither realistic or credible.”
Lowman’s counterpart at the FWD, James Bielby, also said the government had its head in the sand.
“Aggressive below-cost promotions… undermine the competitiveness of the overall grocery market and the ineffective definition adopted by the government will do nothing to prevent this,” he said.
Pubs and health groups are unlikely bedfellows united in their disappointment, albeit for very different reasons. As Lowman drily notes, “the duty plus VAT definition will satisfy no-one apart from the big supermarkets”.
That’s not strictly true, with the WSTA relieved the floor won’t be 50p per unit. But Richard Taylor of Morrisons could scarcely contain his delight.
“The great thing about this policy,” he beamed, “is that for the first time it gives the UK government a guaranteed lever to change the floor price of alcohol by changing the rate of duty. And any extra money would go to the Exchequer.”
That leverage will doubtless be deployed in March’s Budget – and it’s unlikely the floor price will go down. Then, you imagine, the mults won’t be so happy.
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