Mark Wadsworth

This is a spare 'blog in case my main 'blog at markwadsworth.blogspot.com isn't working

The True Price Of A Pint (2)

I was tasked with freeing up a bit of space on our Freeview-recorder-box-thingy, and I watched that programme (a fair summary of which is here) one last time before deleting it for good.

The most outrageous claim they made was that ‘alcohol consumption costs society £16.2 billion a year’, and the most plausible one that people in the UK consume 52 billion units of alcohol a year.

But let’s run with that £16.2 billion ‘total cost’ figure, which divided by 52 billion units = £0.31/unit. Beer duty happens to be 18.57p/unit (from HMRC, a unit = 10 ml alcohol), so – for example – beer duty on a pint (568 ml x 4% ABV) = 2.272 units x £0.1857 = £0.42.

That’s just the beer duty though, what’s the average price people pay for a pint? 60p for a 440 ml can in the supermarket = £0.77/pint and (say) £3/pint in the pub. The average must be about £1 (that’s assuming 9 pints are drunk at home for every 1 in the pub), and out of that £1, 16.67 p is VAT, ergo total tax a on a pint is about £0.59 (£0.42 duty plus £0.17 VAT, stick on another fifth for PAYE on salaries of people working in breweries or alcohol retail, corporation tax etc) = £0.71, divide that by 2.272 = £0.31 tax/unit

£0.31 tax = £0.31 ‘total cost to society’, problem solved.

And I’m pretty sure they didn’t factor in the ‘benefit to society’ of all that boozing, which by definition is roughly equal to the total amount that people spend on booze, i.e. £23 billion*, which means that even by their reckoning, the net benefit to society is a princely £6 billion a year 🙂

* 52 billion units ÷ 2.272 units/pint = 23 billion pints, again assuming cost/pint £1 each.

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