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WSTA Budget response


 23 March 2011 


WSTA warns Budget alcohol tax hike will hit families, growth, jobs   

The WSTA warns today’s inflation busting tax increases on alcohol will further squeeze family budgets and businesses, putting more jobs at risk in Britain’s drinks sector in the year ahead.   

The Budget saw a 7.2% increase in excise duty on wines, spirits and beers as the Chancellor proceeded with the tax escalator which automatically increases tax on alcohol by 2% above inflation.¹  

It means that in just three years in the UK tax on wine has increased by around a third, such that it now represents 56% of the cost of an average priced bottle of wine and 74% of an average priced bottle of spirits.   

For consumers the tax increase equates to:  

  • 15p more for a 75cl bottle of wine
  • 54p more for a 70cl bottle of spirits
  • 4p on a pint of beer
     

The tax increase comes into effect from 00.01 on Monday 28 March. 


WSTA Chief Executive Jeremy Beadles said:   “The escalating price of alcohol adds further pressure to stretched family budgets at a time when inflation is already taking its toll and will damage the opportunities for jobs and growth in the drinks industry. 

“With close to two million jobs supported by the sector, the Chancellor has missed an opportunity to help it play its part in the UK’s all-important economic recovery.”  

Ends

 Notes to Editors: 

Notes to Editors: 

¹In March 2008 the Chancellor announced a 9% increase in alcohol duty and his intention to introduce a 4 year tax escalator, increasing duty rates by 2% above the rate of inflation from the time of the 2009 Budget. In March 2010 the Chancellor announced that all alcohol duty rates would increase by 2% above inflation for two further years, until 2014-15.   

To date HM Treasury has based its alcohol tax escalator calculation on a combination of RPI for 6 months prior to Budget and RPI forecast for 6 months post-Budget.

 

WSTA

The WSTA is the UK lobbying organisation for the wine and spirit industry representing over 340 companies producing, importing, transporting and selling wines and spirits.We campaign to promote the industry’s interests with governments at home and abroad.We work with our members to promote the responsible production, marketing and sale of alcohol.  For more information please contact Gavin Partington:Tel:       +44 (0) 20 7089 3876Mob:     +44 (0) 7966 014058Email:   [email protected]