Chancellor's tax hike on wine kicks off today

The Wine and Spirit Trade Association is warning consumers to brace themselves for a hike in wine prices as the Chancellor’s wine tax kicks in today.

The 3.1% inflationary rise, imposed by Philip Hammond, was announced at the 2018 Autumn Budget when the wine trade was singled out for a rise while other alcohol products saw a duty freeze.

The duty rises by inflation will mean that as of midnight tonight (Friday), the price of a bottle of wine will go up by 7p, sparkling wine 9p and an average priced bottle of fortified wine will also go up 9p. This does not include VAT which would add a further 20% to the wine duty rise.

Currently an average priced bottle of still wine costs £5.73. The WSTA has also warned that if the UK crashes out of the EU without a deal, tariffs on EU wines alongside the duty increases would add an extra 20p to the price of a bottle.

Miles Beale, Chief Executive of the Wine and Spirit Trade Association, said: “As of today, the duty rate on still wine has increased by 7p to £2.23, and on sparkling by 9p to £2.86. This is as a result of the Chancellor singling out wine for an unfair duty increase in last October’s Budget.

"This comes at a particularly bad time for the UK wine industry – the threat of a no-deal Brexit is still on the table with the Government continuing to refuse to rule out leaving the EU without a deal on 29th March. If this happens and the UK does leave without a deal, tariffs on wine from the EU will apply, meaning wine prices will rise by 20p per bottle for still wine and 37p for sparkling wine.

“These price rises are a direct result of the Government’s refusal to back the UK’s wine industry - which supports 190,000 UK jobs - and its active decision to pass on a punishing duty rise; and the Government’s inability to the UK’s trading relationship with the EU, from where over half our wine is sourced.

"The WSTA has been consistent in calling for support for the wine industry and for politicians to say #NoToNoDeal. These price rises were entirely avoidable and bitterly disappointing.”