Still wine has not enjoyed a duty cut in 35 years
The WSTA is calling on the next Chancellor to cut wine and spirit duty after new Government figures provide further proof that duty hikes are bad for the public purse.
Wine, the nation’s most popular alcoholic drink enjoyed by 33 million Brits, was singled out for a duty increase earlier this year and as a result the income from wine receipts were down on last year.
The HMRC Alcohol Bulletin figures released today (Friday) show that wine duty receipts for the last six months are down 2.1% on last year. If the 2.1% drop plays out for the whole year then Treasury would be set to lose £92 million compared to 2018.
For beer and spirits, both of which received a duty freeze, the revenue income was more positive with beer up 2.4% and sprits up 1.7%.
Miles Beale, Chief Executive of the Wine and Spirit Trade Association, said:
“The latest Government figures clearly show that increasing duty is not only bad for business and consumers, but is bad for the public purse too. By delivering a freeze to beer and spirits at the last Budget the Treasury landed a bumper tax windfall. In contrast after a rise to wine duty the Treasury lost revenue. We are calling on the next Chancellor to support British consumers, pubs and the wider hospitality trade by cutting alcohol duty.”
Duty is currently so high that 55% of the average priced bottle of wine and 73% of a bottle of spirits, at 40% abv, sold in our shops and supermarkets is now taken by the Treasury in tax and VAT.
The UK alcohol industry is one of the most heavily taxed in Europe, as we are stung by the third highest duty rates for wine and fourth highest duty rate for spirits across the EU.
British drinkers end up paying 68% of all wine duties collected by all 28 EU member states and 27% of all spirits duties. This is by far the most of any member state despite accounting for only 11 per cent of the total EU population.
The WSTA is calling on its members and the public to lobby MP’s to highlight the UK’s grossly unfair alcohol taxation policy.
Wine businesses and consumers already pay a staggering £4.4bn in duty each year and spirits consumers and businesses £3.8bn.
Following Brexit’s impact on the pound, and rising inflation, the wine and spirit trade has faced a tough trading landscape.
A cut will save UK wine and spirit businesses – which support over 360,000 jobs – thousands of pounds, which can help businesses to invest, grow and create even more jobs.