§ First, then, I turn to Customs and Excise, and in this section I must raise a substantially increased revenue.
§ I propose, therefore, to introduce a further increase in the rates of beer duty, equivalent to 1d. a pint on beer of average 64 strength. This will entail raising the duties by 8½d. per barrel for each degree of strength, subject, as at present, to a minimum on beer of a gravity up to 1027 degrees.
§ There will be a corresponding increase of £1 per proof gallon in the duties on whisky, rum, and other spirits. This increase will be the equivalent of 2s. 4d. a bottle on whisky of the usual strength of 30 degrees under proof. The increase will not, however, apply to perfumed spirits, a very different thing from potable spirits. We have, in fact, agreed with France, as part of the Geneva arrangements, to make certain reductions of duty in respect of the very small quantities of perfumed spirits which are allowed to be imported. These reductions will be incorporated in the new scales.
§ In regard to wine, the changes which I propose will have two objectives. In the first place, there will be a general increase of the rates of duty, corresponding to the rates of increase for beer and spirits. For heavy wines of foreign origin, the increase will be the equivalent of 1s. a bottle, and for light wines, 6d. The Empire wine countries have, however, made out what seems to me a good case that, although the margin of preference on their heavy wines has been continued at the amount of 4s. a gallon—at which it stood before the war—this difference has become proportionately of much less value in relation to the present rates of duty. We therefore agreed, at Geneva, that this margin should be raised to 10s. a gallon. The practical effect of this is that the rates on heavy wines from South Africa, Australia and other Empire countries will remain unchanged at the present level.
§ In addition, we have undertaken with France to make certain reductions in the rates of surcharge on sparkling wines and on still wines imported in bottle. These concessions, details of which have already been published, will be brought into effect in the new scale of rates that I now propose. There will be corresponding changes in the rates on British wines, equivalent to an extra 6d. a bottle on light wines, and 1s. a bottle on the heavier types. In the Debate on the November Finance Bill, my right hon. Friend the Financial Secretary undertook to give sympathetic consideration to a proposal to allow the British wine industry to raise the strength 65 of their product in bond with duty-free spirits, in the same way that importers of foreign and Empire wines have been able to do for many years. I have decided that it would be reasonable to meet this request of the industry, and a provision to that effect will be included in the Finance Bill. Further details of these proposals will be found in the usual White Paper. The new rates of duty will come into operation from tomorrow, and are estimated to yield additional revenue of £45 million in a full year and £41 million in 1948–49.