Brewers seek tax freeze as beer sales fall

LONDON (Reuters) - Beer sales in pubs have slumped to the lowest level since the 'Great Depression' of the 1930s, industry figures showed Tuesday, as brewers and pubs launched a campaign to freeze the tax on beer.

Pubs are now pulling 14 million less pints a day since the brewing peak almost thirty years ago, figures from the British Beer and Pub Association (BBPA) showed.

Since 1979, the total beer market -- including beer sold in supermarkets and shops as well as pubs -- has fallen by 2.5 billion pints a year, or 7 million pints a day, as British drinkers developed a taste for wine and spirits.

Pub beer sales have fallen by almost half, or more than 5 billion pints, the figures revealed.

The body, which is calling for a freeze in duty on beer in the face of falling profits, said pub sales were now at the same level of volume as the 'Great Depression', which lasted a decade from 1929.

The fall in sales has come amid soaring costs of barley, malt, glass, aluminium and energy prices, which has hurt brewing company profits, the group said.

The BBPA said since 2004 major UK brewers have seen profits plummet by almost 80 per cent and claimed brewers make 0.7 pence per pint profit, compared to the average 33 pence per pint they pay in taxes.

The "stark market conditions are being made worse by the government's current tax policy", said the group, which accounts for 98% of UK beer brewing market and almost two thirds of Britain's 58,000 pubs.

Frank Soodeen, spokesman for the charity Alcohol Concern, said beer doesn't need a tax freeze.

"Every year excise duty has only been raised in line with inflation, so beer has not got more expensive when you take into account the higher incomes we all have," he said.

"Price is an important factor in under-age consumption. Knowing that beer is the most popular drink for under-age consumption (freezing tax) would not be a helpful step."