The Budget: Less-than-vintage effort gets just two cheers

Published on Wednesday 23 March 2011 15:04

WINE merchant Michael Romer yesterday raised a glass to the Chancellor's efforts to cut red tape and reduce fuel costs - but said both measures should be ongoing processes rather than one-off actions.

Romer, who owns the Peter Green & Co wine shop in Morningside, Edinburgh, with his wife, Maurog, welcomed the fact that the Chancellor did not heap extra duty rises on wine.

But he called on the coalition government to link duty to the number of units of alcohol in a product, instead of its percentage of alcohol by volume. Doing so should mean that the tax would target high-alcohol drinks sold at cheap prices.

Romer said: "The absence of an additional duty rise is very welcome, but it does show a lack of imagination.

"If the Chancellor were to link duty to units of alcohol, then it is unlikely to affect our wines or craft beers - instead, it would hit those who produce cheap drinks with high alcohol content."

Romer also welcomed the unexpected cut in corporation tax, which will reduce from 21 per cent to 20 per cent the levy on small businesses making less than 300,000 in profits.

"Any moves in the right direction on tax are good," Romer said. "They will help owners to invest more money into their businesses."

Peter Green & Co has four staff and so it will be exempt from introducing any new employment regulations for three years from 1 April.

Romer said: "The exemption will be useful - it's hard to keep up with all the new legislation and so that will make life easier.It's a good idea, but there should be a lot more done by way of the simplification of employment law for smaller businesses."

And he said suspending the fuel duty escalator while oil prices are still above $75 a barrel will help businesses to work the cost of fuel into their prices.

He said he had not raised prices to take account of the recent increases in fuel costs, but firms would have to look at passing on the higher fuel costs to customers in the longer term.

Romer said: "We can take a hit in the short term, but eventually … you have to put your prices up. This measure will help businesses to plan ahead if they know what fuel prices will be doing. The Chancellor should look at keeping it in place for the longer term."

PETER RANSCOMBE