Economic Commentary: Price Floor - A ban on the sale of alcohol below a minimum price will be introduced in England and Wales from 6 April 2012.

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Economic concept: Price Floor

Below-cost alcohol to be banned from April


8 November 2011 last updated at 16:07 GMT

A ban on the sale of alcohol below a minimum price will be introduced in England and Wales from 6 April 2012.

Shops and bars will not be able to sell drinks for less than the tax paid on them - a move the government says will cut crime.

It works out as 38p for a can of weak lager and £10.71 for a litre of vodka.

Health campaigners say the price "floor" is too low to have any impact, but the drinks industry has described it as a "pragmatic solution".

The move comes as the Scottish government presses ahead with plans to introduce a minimum price per unit of alcohol.

Its first attempt to do so, setting the price at 45p per unit, failed during the last Parliament, but MSPs have now and say the measure is needed as part of the "battle with alcohol misuse".

Anne Milton, Public Health Minister at Westminster, told a Commons committee last month that a minimum price per unit was "probably illegal" under European trade laws and would be challenged in the courts.

But she said the government was in "on-going discussions" with the Treasury on how further price manipulation could be used to encourage safer drinking.

'First step'

The pledge to ban the sale of alcohol below cost price was part of the coalition agreement and will mean that drinks must cost more than the rate of duty plus VAT.

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Home Office Minister James Brokenshire has described the move as "an important first step" which will prevent around 7,000 crimes a year - 2,000 of them violent.

But the British Medical Association says it will make little difference.

A spokesman for Alcohol Concern said: "The new provision must be welcomed, as it will hopefully make some difference at the very extreme cheap end of the market favoured by street drinkers and the young. 

"Unfortunately, the majority of problem drinkers will unlikely be affected - the approval to the scheme on behalf of the drinks industry probably indicates that they are not ...

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