The development of the brewing industry in England is intimately interwoven with the history of its taxation, and the regulations which have from time to time been formed for the safeguarding of the revenue. The first duty on beer in the United Kingdom was imposed in the reign of Charles II. (1660), namely 2s. 6d. per barrel on strong and 6d. per barrel on weak beer. This was gradually increased, amounting to 4s. 9d. on strong and 1s. 3d. on weak beer in the last decade of the 17th century, and to 8s. to 10s. in the year 1800, at which rate it continued until the repeal of the beer duty in 1830. A duty on malt was first imposed in the reign of William III. (1697), and from that date until 1830 both beer duty and malt tax were charged. The rate at first was under 7d. per bushel, but this was increased up to 2s. 7d. prior to the first repeal of the beer duty (1830), and to 4s. 6d. after the repeal. In 1829 the joint beer and malt taxes amounted to no less than 13s. 8d. per barrel, or 4&FRAC12;d. per gallon, as against 2&FRAC12;d. at the present day.
From 1856 until the abolition of the malt tax, the latter remained constant at a fraction under 2s. 8&FRAC12;d. A hop duty varying from 1d. to 2&FRAC12;d. per pound was in existence between 1711 and 1862. One of the main reasons for the abolition of the hop duty was the fact that, owing to the uncertainty of the crop, the amount paid to the revenue was subject to wide fluctuations. Thus in 1855 the revenue from this source amounted to £728,183, in 1861 to only £149,700.
It was not until 1847 that the use of sugar in brewing was permitted, and in 1850 the first sugar tax, amounting to 1s. 4d. per cwt., was imposed. It varied from this figure up to 6s. 6d. in 1854, and in 1874, when the general duty on sugar was repealed, it was raised to 11s. 6d., at which rate it remained until 1880, when it was repealed simultaneously with the malt duty. In 1901 a general sugar tax of 4s. 2d. and under (according to the percentage of actual sugar contained) was imposed, but no drawback was allowed to brewers using sugar, and therefore - and this obtains at the present day - sugar used in brewing pays the general tax and also the beer duty.
By the Free Mash-Tun Act of 1880, the duty was taken off the malt and placed on the beer, or, more properly speaking, on the wort; maltsters' and brewers' licences were repealed, and in lieu thereof an annual licence duty of £1 payable by every brewer for sale was imposed. The chief feature of this act was that, on and after the 1st of October 1880, a beer duty was imposed in lieu of the old malt tax, at the rate of 6s. 3d. per barrel of 36 gallons, at a specific gravity of 1.057, and the regulations for charging the duty were so framed as to leave the brewer practically unrestricted as to the description of malt or corn and sugar, or other description of saccharine substitutes (other than deleterious articles or drugs), which he might use in the manufacture or colouring of beer. This freedom in the choice of materials has continued down to the present time, except that the use of "saccharin" (a product derived from coal-tar) was prohibited in 1888, the reason being that this substance gives an apparent palate-fulness to beer equal to roughly 4° in excess of its real gravity, the revenue suffering thereby. In 1889 the duty on beer was increased by a reduction in the standard of gravity from 1.057 to 1.055, and in 1894 a further 6d. per barrel was added.
The duty thus became 6s. 9d. per barrel, at a gravity of 1.055, which was further increased to 7s. 9d. per barrel by the war budget of 1900, at which figure it stood in 1909. (See also Liquor Laws.)
Prior to 1896, rice, flaked maize (see below), and other similar preparations had been classed as malt or corn in reference to their wort-producing powers, but after that date they were deemed sugar in that regard. By the new act (1880) 42 lb weight of corn, or 28 lb weight of sugar, were to be deemed the equivalent of a bushel of malt, and a brewer was expected by one of the modes of charge to have brewed at least a barrel (36 gallons) of worts (less 4% allowed for wastage) at the standard gravity for every two bushels of malt (or its equivalents) used by him in brewing; but where, owing to lack of skill or inferior machinery, a brewer cannot obtain the standard quantity of wort from the standard equivalent of material, the charge is made not on the wort, but directly on the material. By the new act, licences at the annual duty of £1 on brewers for sale, and of 6s. (subsequently modified by 44 Vict. c. 12, and 48 and 49 Vict. c. 5, etc., to 4s.) or 9s., as the case might be, on any other brewers, were required. The regulations dealing with the mashing operations are very stringent.
Twenty-four hours at least before mashing the brewer must enter in his brewing book (provided by the Inland Revenue) the day and hour for commencing to mash malt, corn, etc., or to dissolve sugar; and the date of making such entry; and also, two hours at least before the notice hour for mashing, the quantity of malt, corn, etc., and sugar to be used, and the day and hour when all the worts will be drawn off the grains in the mash-tun. The worts of each brewing must be collected within twelve hours of the commencement of the collection, and the brewer must within a given time enter in his book the quantity and gravity of the worts before fermentation, the number and name of the vessel, and the date of the entry. The worts must remain in the same vessel undisturbed for twelve hours after being collected, unless previously taken account of by the officer. There are other regulations, e.g. those prohibiting the mixing of worts of different brewings unless account has been taken of each separately, the alteration of the size or shape of any gauged vessel without notice, and so on.