The Association of Convenience Stores (ACS) has hit out at Ministers’ decision to define the cost of alcoholic drinks simply as tax, with no account for the cost of producing, distributing or selling the products. As a result of this decision, the Government’s impending ban on below-cost selling of alcohol will barely affect the supermarket promotions that have attracted so much criticism.
ACS chief executive James Lowman said:“After talking tough, the Government has ducked a tough decision. Their final proposal will not curb aggressive supermarket discounts like many of those we saw over the Christmas period. Defining‘cost’ as just tax is neither realistic, nor credible.”
Ministers made a pre-election commitment to ban the sale of alcohol below cost, however the issue of finding a suitable definition for cost has been controversial. ACS, working in conjunction with the Federation of Wholesale Distributors, made the case for the definition of cost to be based on a realistic estimate of production, marketing and distribution of the product.
Lowman continued:“The real cost of an alcohol product on the shelf is obviously more than the cost of duty + VAT. We are disappointed that they have not listened to the strong case we made for a ban that reflected more closely the elements that made up the cost of the product.
“The biggest frustration is that the‘duty + VAT’ definition will satisfy no one, apart from the big supermarkets, and so the uncertainty and debate will continue to rage. Local shops and wholesalers were keen to see a workable and credible ban in place that would provide certainty. We will continue to try to bring some common sense to this debate and find workable solutions to this problem.”
Source: ACS
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