Finance (No. 2) Act 2023

Chapter 2 Draught relief

50 Qualifying draught products: reduced rates

(1) Alcohol duty is charged on qualifying draught products at the reduced rates shown in Schedule 8 (instead of at the rates shown in Schedule 7 (the “full rates”)).

(2) But a person liable to pay alcohol duty on qualifying draught products may, for the purposes of section 52(2), elect for duty to be charged at the full rates.

51 Alcoholic products qualifying for draught relief

(1) “Qualifying draught products” means alcoholic products that—

(a) are of an alcoholic strength of less than 8.5%, and

(b) at the excise duty point are contained in, or are being transported to a place in the United Kingdom for the purpose of being transferred to, a large draught container.

(2) But alcoholic products that are produced in the United Kingdom by a person otherwise than in accordance with an approval under section 82 are not qualifying draught products.

(3) A “large draught container” means a container which—

(a) is of a capacity of at least 20 litres, and

(b) incorporates, or is designed to connect to, a qualifying system for dispensing individual drinks.

(4) For the purposes of subsection (3)(b), “qualifying system” means—

(a) a pressurised gas delivery system, or

(b) a pump delivery system.

(5) The Commissioners may by regulations—

(a) amend subsection (3)(a) so as to specify a different capacity;

(b) amend subsection (4) so as to add or remove, or to vary the description of, a qualifying system.

52 Repackaging qualifying draught products

(1) For the purposes of this section, qualifying draught products are “repackaged” if—

(a) they are transferred to containers that are not large draught containers, but

(b) are not transferred in the course of serving a beverage for immediate consumption.

(2) A person may not repackage qualifying draught products on any premises in the United Kingdom unless—

(a) the repackaging is authorised, or

(b) alcohol duty was charged on the products at the full rates, in accordance with an election under section 50(2).

(3) Repackaging is “authorised” if it is carried out by a person who is—

(a) approved and registered under section 100G of CEMA 1979 by virtue of regulation 3 of the Warehousekeepers and Owners of Warehoused Goods Regulations 1999 (S.I. 1999/1278), or

(b) approved under section 82 (producers of alcoholic products).

(4) Where the repackaging of qualifying draught products is authorised, an amount equal to the duty shortfall is treated, for the purposes of this Part, as an amount of alcohol duty charged on the repackaged products.

(5) In this section and in section 53, the “duty shortfall” in relation to repackaged qualifying draught products is the difference between—

(a) the alcohol duty payable on the alcoholic products under section 50(1) (draught products: reduced rates), and

(b) the alcohol duty that would have been payable on the alcoholic products under section 48 (rates) if they had not, at the excise duty point, been qualifying draught products.

(6) For the purposes of subsection (2), the Commissioners may by regulations require a person to provide, on the supply to another person of qualifying draught products in respect of which an election under section 50(2) has been made, information or documents, of a description specified by or under the regulations, as evidence that duty has been charged at the full rates.

53 Repackaging in contravention of section 52 (2)

(1) This section applies if a person repackages qualifying draught products in contravention of section 52(2).

(2) The Commissioners may—

(a) assess as alcohol duty due from the person mentioned in subsection (1) an amount equal to the duty shortfall, and

(b) notify that person or that person’s representative of any assessment under paragraph (a).

(3) The conduct mentioned in subsection (1) attracts a penalty under section 9 of FA 1994, calculated by reference to the amount of duty referred to in section 52(5)(b).

(4) Any alcoholic products, articles (including packaging or equipment) or substances in the person's possession, used (or which may be used) for or in connection with the repackaging, are liable to forfeiture.