The UK wine industry is being unfairly singled out in the duty rise, say experts
Posted on Mon 21st Mar 2016 at 11:49
The announcement by Chancellor George Osborne, on March 16, that wine would see a duty rise at the same level as inflation, came as a huge disappointment to those in the industry.
While beer, cider and spirits received duty freezes to help their industry recover and thrive, wine was once again targeted. Not only does the UK already have the second highest wine duty in Europe, with the amount of tax on each bottle £2.08 on still wines, but the Wilson Drinks Report states that ‘total duties on wine are forecast to increase by 32% between 2014/15 and 2020/21’. Total duty receipts, consequently, are predicted to rise from £10.6 billion in 2015 to £13 billion by 2020/21. While this seems like a great move for the cash-strapped treasury, Miles Beale, chief executive of the Wine and Spirits Trade Association, pointed out that this is in fact short-sighted: “We are disappointed that 30 million wine consumers have been singled out for a duty rise and what’s more it’s counterproductive. The freeze in wine duty in 2015 has resulted in £118 million extra revenue to the Treasury in the past 10 months, up 4%. Wine was the only alcoholic drink not to receive a cut and netted the Chancellor the most – which makes it very unfair that it has been penalised." Industry experts have also stated that not only is the entire wine industry affected by this move, but that it’s particularly damaging for the English wine sector - something the chancellor should be seeking to protect. Ben Walgate, CEO of Gusbourne Estate – famed for its sparkling Kentish wines – commented: “I think the government’s view is disappointing and we are being penalised. English wine production is a booming business generating significant revenue and employment and should be nurtured and supported." Only time will tell how much of an impact the latest duty rise, which has put around 5p on every bottle, will have on the trade as a whole. We’re sure, however, that Chancellor Osborne isn’t the flavour of the month in his local wine shop!