The tax escalator was introduced seven years ago (Source: Getty)
George Osborne's decision on whether to change the tax paid on beer will be a hot topic tomorrow.
There has been a 40 per cent increase in beer duty since 2008, and a third of what we pay for one pint of beer now goes to the government. Meanwhile, beer's popularity has fallen in the UK over the last 10 years
Campaigners say there is a risk pub-going will no longer be an “affordable activity”
with tax at its current level, since beer is the most regularly purchased beverage across the nation.
But 2013 and 2014 set off a change in fortunes for British beer drinkers – the chancellor knocked a penny off a pint during both annual Budgets, and more importantly scrapped the beer tax escalator introduced by the previous government in 2008. This had stipulated prices will rise by two per cent above inflation each year, and was supposed to continue until 2015.
Research by the Centre for Economics and Business Research (CEBR) shows if the escalator had remained in place over the last two years
, a pint would be 16p more expensive by now. Some 1,047 pubs would have been closed by the end of this year, 750m fewer pints would have been sold in 2014 and 26,000 current jobs would not exist.
This year there's a high chance the chancellor will cut beer duty once more, and if he reveals the same change in tomorrow's Budget all of the UK's pubs are set to benefit. The pub-goers are set to gain something, too – each day, approximately 20m pints of beer are enjoyed by people in the UK.
By announcing a third cut in beer duty in next week's Budget, the government can ensure that the momentum of the previous cuts is maintained and the independent brewing sector, now recovering and starting to thrive after years of unfair taxation, continues to grow, bringing jobs and investment to hundreds of local economies around the country.
If the chancellor does bring down tax once more, London will benefit more than most given its high concentration of pubs.
The places with the most pubs
With 407 pubs, Westminster is the area of London that has the highest number set to gain from a duty cut. Neighbouring Camden and Islington, with 257 and 243 pubs respectively, are also set to benefit.
Other areas in the centre of the City, where pubs are concentrated are Southwark, Lambeth and Tower Hamlets. The boroughs further out have fewer pubs despite having a larger area.
The map below shows the number of pubs in each London borough. If you're on a mobile or tablet, swipe to the right of the image viewer to scroll down the page.
Pub-goers in Westminster will collectively save the most
Taking into account the amount of money spent on pints each year, the map below shows how much pub-goers in each borough will save in total if another cut of 1p is introduced.
Being home to the most pubs, it's unsurprising that Westminster will make the largest annual saving of £715,600 each year. Following some way behind with a saving of £364,800 will be Camden, followed by the City of London, Hounslow and Richmond.
The map below shows the amount of money that would be saved (£) by each London borough with a 1p cut in beer duty. If you're on a mobile or tablet, swipe to the right of the image viewer to scroll down the page.
New jobs for Londoners
Although the numbers aren't huge, they're enough to make a difference to a few Londoners' lives. If 1p is cut off the price of each pint, 15 new pub jobs will be created in Westminster, seven in Camden and four in Islington.
Below is a list of the top 12 boroughs for job creation - although every part in London will have at least one extra job going.