Alcohol and tobacco: 'Because of World Cup, I'm freezing duty on champagne'

An optimistic Gordon Brown froze duty on champagne and sparkling wine in anticipation of victory in the World Cup. But there was dismay for beer drinkers, who will see the cost of a pint rise by a penny.

For the fourth consecutive year, the Chancellor announced that excise duties on beer, wine and cigarettes would rise in line with inflation from midnight on Sunday. That will put 4p on a bottle of wine and 9p on a packet of cigarettes. But he froze duties on whisky and all other spirits for the ninth time on the trot. The duty on cider was also frozen. "In anticipation of World Cup success this summer, I am freezing duty on champagne and on British sparkling wine," Mr Brown said to MPs' applause.

Small community pubs are tipped to suffer from the rise in beer duties, which critics said exacerbated the anomaly about the amount of tax paid on beer and wine. Camra, which campaigns for real ale, said the excise increase would add 9p to the cost of a pint in a pub. "Such high costs increase the risk that people will no longer visit the pub as frequently, therefore putting the viability of community pubs at risk and threatening the livelihood of hard-working licensees," Mike Benner, chief executive of Camra, said. "Given that beer is our traditional drink and the World Cup is being held in Germany, it's outrageous that the Chancellor has frozen duty on champagne," he added.

A spokesman for the British Beer and Pubs Association said beer had endured a 22 per cent tax hike since 1997, while the strongest alcoholic drinks had escaped more lightly. The lobby group calculated the Government was missing out on £200m of revenues a year by not taxing stronger wine more than weak wine - as it does with beer.

The Wine and Spirit Trade Association repeated its calls for the 36p surcharge on a bottle of sparkling wine to be removed, although it welcomed the continuing freeze on spirits duty. Jeremy Beadles, the WSTA's chief executive, said it was payback for the extra costs the industry had been forced to shoulder to implement a new duty stamp regime.

The Chancellor also froze air passenger duty, disappointing green activists. From 1 November, passengers flying to Croatia will pay less in duties on their tickets in recognition of the country's attempts to join the EU.

* Treasury Budget site

* Chancellor's Statement in full