The Chancellor of the Exchequer has decided to raise the duties payable on beers, wines and spirits. Assess the likely impact of this policy on the various markets that are likely to be affected.

The Chancellor of the Exchequer has decided to raise the duties payable on beers, wines and spirits. Assess the likely impact of this policy on the various markets that are likely to be affected.



“The chancellor of the exchequer is the government's chief financial minister and as such is responsible for raising government revenue through taxation or borrowing and for controlling overall government spending.” (http://news.bbc.co.uk/1/low/uk_politics )
It is estimated in the pre-budget report that the public spending bill for the UK this year will be £420bn. The Chancellor of the Exchequer aims to raise £38bn from Excise Duties to finance a part of this Public Spending. (Pre budget report www.ukonline.gov.uk )
Duties are indirect taxes imposed on goods such as alcohol, tobacco and fuel. They are indirect because they are in some extent eventually paid by consumers. They are in this way unlike direct taxes whereby the amount of tax deducted depends on the taxpayers individu...