The Government said the provision would simultaneously open doors for smaller brewing companies seeking to reach new customers, while giving pub-goers a wider selection of drinks at their local.
Beyond the targeted relief for small producers, however, the Budget documents revealed that broader alcohol duty rates will increase in line with RPI inflation from 1 February 2027.
Reports circulating before the announcement had suggested duty could climb by 3.9 per cent, which would add roughly 2p to the tax on a pint of beer.
The British Beer and Pub Association had urged ministers to freeze beer duty and expand the draught duty discount, pointing out that UK brewers already shoulder some of the highest duty rates on the continent.
Chief executive Emma McClarkin had argued that a freeze combined with greater draught relief would deliver “more affordable pints, greater investment, and more jobs”.