The Government announces minimum pricing plans
The Government has unvielled plans to set a minimum price for alcohol in England and Wales - the first time a base price has been set. This means it won't be possible to sell alcohol below duty plus VAT. The Home Office believes that a floor on alcohol price would prevent around 7,000 crimes a year - 2,000 of them violent. Products associated with problem drinking would be specifically targeted.
Health campaigners say that it is too low to have an impact - but the drinks industry described the proposals as a pragmatic solution. Last year, the Scottish Parliament rejected plans for a minimum price on alcohol, amid claims it would penalise responsible drinkers and could be illegal under European competition law.
Richard Taylor, a director at Morrisons supermarket chain raises an interesting point saying that the proposals provided the government with a guaranteed lever which it can use to set a floor price for alcohol.
So. for the first time, if a chancellor raises duty all of that duty would, by law, have to be passed on to the customer, whereas previously some retailers may have absorbed that cost.