The price of an average pub pint of beer and lager is likely to fall but smokers will end up paying at least a penny extra for 20 premium cigarettes as the Chancellor attempted to offset the 2.5 per cent reduction in VAT on tobacco and alcohol.

As part of the Government offensive to encourage more smokers to give up their habit, the new rates on cigarettes and tobacco are to be imposed from 6p.m. tonight while the new rates of alcohol come into force next Monday.

Pubs, which are currently closing at the record rate of five a day, may gain some benefits from the new pricing formula to be introduced from.

The impact is more likely to be seen in higher prices for alcohol sold in supermarkets and off-licences.

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A Treasury spokesman said that pubs which tended to charge more for drinks would have higher reduction because the VAT levied was higher than on retail alcohol sales.

According to Government figures the average price of beer in a pub is now £2.57, which includes 38p VAT and 36p duty. The new average price is likely to £2.54, 33p VAT and 39p duty.

A pint of lager in a pub is now priced £2.69 on average, of which 40p is VAT and 31p duty.

The current average price of supermarket pint of beer is £1.03, which uincludes 15p VAT and 36p duty. From Monday ithis is expected to go up a penny to £1.04, with VAT at 14p abnd duty 39p.

There was dismay however from the beer trade that Alistair Darling had failed to pass on the whole reduction of VAT and it would trigger further closeures of community pubs..

Mike Benner, chief executive of the Campaign for Real Ale(CAMRA), said it was a missed opportunity to help an industry in crisis.

At the current rate of closures some 7,500 pubs could be closed by 2012.

He said: “The Government’s failure to support pubs will undermine community life, ruin livelihoods and deprive people of an affordable night out at the local pub.”

Mark Hastings, spokesman for the British Beer and Pub Association, said there was “genuine dismay and disbelief” that the Chancellor had failed to recognise the economic plight of pubs.

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