£700m minimum alcohol price boost for supermarkets

The UK’s largest supermarkets stand to make £700m if a minimum price for alcohol drinks is introduced, according to a study.

The Institute of Fiscal Studies has assessed the impact of a 45p minimum per unit of alcohol. The price was recently proposed by the Scottish Government as part of the Alcohol Bill aimed at tackling misuse.

“We estimate that a minimum price of 45p per unit of alcohol would results in large transfers to alcohol producers and off-license retailers; of the order of £700m if rolled out across Britain,” the IFS says.

It adds that Tesco would benefit the most, with gains of about £230m, followed by Asda, £130 million, and Sainsburys, £100 million.

The Institute says that although some of the £700m would be shared with producers “the biggest relative gains are made by low-price and discount supermarkets, which sell the largest proportion of their alcohol below the 45p threshold.”

Alcohol producers and supermarkets oppose minimum pricing, claiming it would unfairly punish the majority of drinkers.

The coalition Government in Westminster has so far ruled out minimum pricing but does want to see an end to the sale of alcohol below cost price.

It is currently consulting with industry in the hope of defining “below cost”.

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