UK Distillers Raise Concerns of ‘Gin-flation’ as 65% of Londoners Report Cutting Back Bar Visits Amid Soaring Alcohol Prices

London bars are reportedly being visited less following an increase in the cost of alcohol in the United Kingdom. (Photo: Mike Yakaites/Pexels)

In a recent survey conducted by Survation, it was revealed that 65% of London residents are cutting back on their visits to local bars, attributing the reduction to the escalating costs of alcoholic beverages.

As reported by The Standard on Tuesday, this consumer trend underscores the pervasive impact of what industry insiders are terming “gin-flation,” a phenomenon precipitated by soaring production expenses in the distillery sector. Concerns are mounting among distillery proprietors, who contend that such inflationary pressures may pose a dire threat to the viability of independent enterprises.

Distillers are imploring Chancellor Jeremy Hunt to consider a reduction in alcohol duty as part of the upcoming budget, citing the recent imposition of duty hikes effective since Aug. 1. Peter Monks, spokesperson for the UK Spirits Alliance and owner of Shakespeare Distillery, emphasized the compounding challenges faced by distillers amidst a backdrop of economic turmoil.

“It’s been a difficult few years grappling with Covid, spiraling costs and a cost of living crisis, and we’ve now been hit hard by the duty rise that came into effect on August 1,” Monks said in The Standard report.

“It’s driving up the price of our spirits, harming the valued hospitality venues we supply, and is effectively an unfair tax on consumers who want to support their local distillery, and indeed local hospitality venues.”

Over the past six months, over 90% of London pubs have experienced a notable increase in alcoholic beverage prices, The Standard noted, with the cost of a gin and tonic surpassing £10 ($12.73) in numerous central London bars. Notably, the inflation rate for spirits in the U.K. escalated from 5% in July to 7.7% in January.

“The current level of duty is unsustainable, and we call for a cut to duty at the Budget,” Monks added, per The Standard. “If it is not cut, we will continue to see rising prices and struggle amid a difficult economic climate.”

“I’m just one of hundreds of distillers across the country who are worried for their future.”

According to a survey by the UK Spirits Alliance, 70% of distillers in the U.K. express uncertainty about their capacity to invest in their companies due to the duty increase.

“In our pubs and bars, consumers wanting to enjoy a gin and tonic, or a cocktail still find it increasingly expensive,” a spokesperson from the UK Spirits Alliance said, according to The Spirits Business.

“That is why the spirits sector has written to the chancellor to urge him to cut duty in the March budget to ensure that buying a drink in a pub doesn’t become an unaffordable luxury.”

“Bringing duty down would also be good news for a hospitality sector grappling with rising costs and warning of yet more closures; and good news for British distillers struggling to bounce back from last year’s record tax hike.”

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