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| 15 March, 2023
Chancellor delivers bitter blow to wine businesses and consumers
The Wine and Spirit Trade Association is deeply disappointed that the Chancellor has chosen to stifle British business and punish the UK’s cash-strapped consumers by significantly increasing wine and spirit duty.
The announcement comes after the WSTA warned that any alcohol duty increase would stoke inflation, which Government claims it is aiming to bring down.
When the Government’s new alcohol duty regime comes into force on August 1st 2023 – which will broadly tax alcohol according to strength – some 90% of all still wine is set to see at least a 9% duty rise.
At today’s Budget the Chancellor, Jeremy Hunt, announced that the freeze to alcohol duty will end on August 1 and has chosen to increase duty by inflation – at 10.1% RPI – meaning wine drinkers are set for a staggering 20% tax hike.
This tax rise will mean that duty on a bottle of still wine will go up by 44p. For fortified wines the duty rises will be even greater with port set to rise by £1.30 a bottle and a bottle of vodka goes up by 76p.
Wine drinkers will see the biggest single increase in almost 50 years.
Miles Beale, Chief Executive of the Wine and Spirit Trade Association, said:
“The Government’s decision to punish wine and spirit businesses and consumers with a 10% duty hike for spirits and a massive 20% for wine, from 1 August, is staggering. It is the largest increase in wine duty since 1975.
This Budget directly contradicts what this Government claims it is trying to tackle. It will further fuel inflation. It will heap more misery on consumers. And it will damage British business, especially those in the hospitality supply chain, who are still trying to recover from the pandemic.
The double whammy tax hike for wine is a particularly bitter blow for the UKs SME-rich wine businesses. It begs the question – yet again – what does Government have against people who choose to produce and drink wine?
These crippling inflationary tax hikes will be lumped on top of stealth tax rises for some alcoholic products, which the Government has built into the move to taxing alcohol by strength.
After all the effort to relaunch hospitality supply chains in 2022, the Government is offering no help in 2023 for the wine and spirit trade – and particularly for the UK’s 33 million wine drinkers who will see their – and the nation’s – favourite drink hit with a 44p duty rise in the midst of a cost-of-living crisis.”
The table below includes the current duty rates for different alcoholic products, includes duty rates from Aug 1st after the introduction of the new duty regime, plus the impact of an inflationary duty rise of 10.1% (RPI).
|Current Duty||Duty from 1 August||Difference||% change|
|Vodka 37.5% abv 70cl||£7.54||£8.31||£0.76||10|
|Sparkling Wine 12% abv 75cl||£2.86||£2.67||-£0.19||-7|
|Still Wine 12.5% abv 75cl||£2.23||£2.67||£0.44||20|
|Sherry 15% abv 75cl||£2.23||£3.21||£0.97||44|
|Port 20% abv 75 cl||£2.98||£4.28||£1.30||44|
|spirit-based Cream Liqueur 17% abv 70cl||£3.42||£3.39||-£0.03||-1|
|Pre-Mixed G&T 5% abv 250 ml||£0.36||£0.31||-£0.05||-14|
|440 ml can cider 4.5% off trade||£0.18||£0.19||£0.01||8|
|pint cider 4.5% on-trade (draught)||£0.23||£0.22||-£0.00||-2|
|440ml can beer 4.5% off trade||£0.38||£0.42||£0.04||10|
|pint beer 4.5% on trade (draught)||£0.49||£0.49||-£0.00||-1|