The Inland Revenue Act 1880 (43 & 44 Vict. c. 20), also known as the Free Mash-Tun Act, full title An Act to repeal the duties on Malt, to grant and alter certain duties of Inland Revenue, and to amend the Laws in relation to certain other duties, was a United Kingdom Act of Parliament passed in 1880 during the reign of Queen Victoria.
Until the Prime Minister and Chancellor of the Exchequer William Gladstone announced the new measure in his budget speech of 1880, breweries had been been taxed on the raw materials they used, mainly malted barley, which had been subject to taxation since 1660.[a] In a move that had implications for brewers for the next hundred years, they were henceforth to be taxed on the sugar content of their wort[b] based on a formula engineered by the Inland Revenue regardless of what raw materials were used and the amount or strength of the beer that was produced.
The passage of the Beerhouse Act of 1830 had resulted in an explosion in the number of beerhousesA beerhouse was a type of public house created in the United Kingdom by the 1830 Beerhouse Act, legally defined as a place “where beer is sold to be consumed on the premises”. and the brewers to supply them; Baines Directory of 1825 lists 27 breweries in Manchester and Salford, but by 1875 there were 75, a threefold increase. The effect of the Inland Revenue Act was to force many of the smaller and less efficient breweries out of business, as they were no longer able to compete with their larger brethren.
The Act laid down a number of conditions that brewers were expected to adhere to, which proved to be too onerous for some breweries. All brewers had to purchase an annual licence, register their premises and the equipment used in their brewing process, and give 24 hours notice of their intention to brew.
It was not until 1993 that the burden of taxation was shifted to the alcohol content of the finished beer.
- A similar tax on hops had been removed in 1870.
- Wort is the sweet liquid to which yeast is added to begin the fermentation process.