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Wine and spirit sector feels the pinch as duty escalator bites


Total alcohol sales continue to fall according to the latest Wine and Spirit Trade Association market report, which shows the duty escalator continuing to impact negatively on the sector.


The quarterly report shows that volume sales in the off trade were down 3% for the year and 3% in the last 12 weeks, while on trade sales were down 3% for the year and 2% in the last 12 weeks.  

For wine, volume sales in both the off and on trade were down 1% in the short term, while spirit sales for the year were down 2% in the off trade and flat in the on trade. 

Despite the fall in volume growth, total alcohol prices were up by 2% in the off trade and 4% in the on trade for the year. This was largely down to the duty escalator which increased duty on wines and spirits by a further 5.3% in this year’s Budget.

The WSTA Market Report draws on data and analysis from Nielsen, CGA Strategy and the Wilson Drinks Report. The data reveals that:

Off trade

  • Once  again sparkling wine was the only major category to show positive volume growth in both the short and long term, up 10% for the year and 7% for the last 12 weeks.
  • Volume sales of gin and vodka were down by 2% for the year, however gin sales did increase by 1% in the last 12 weeks and vodka finished the quarter steadily.
  • Rum was the only spirits category with annual growth, up 4%.

On trade

  • Champagne and sparkling wine enjoyed strong volume growth in the last quarter, up by 7% and 9% respectively. 
  • Within the spirits category; malt whisky, liqueurs, and brandy all enjoyed annual volume growth at the expense of vodka and whisky. 

Commenting on the report Miles Beale, Chief Executive of the WSTA said: 

“While there are a small number of categories in the wine and spirit sector with modest volume growth, the overwhelming picture is one of decreased sales and increased duty rates, with consumers inevitably having to foot the bill.

“Since the introduction of the alcohol duty escalator in 2008, duty on wine has increased by 50% and spirits by 44%, putting the sector under significant pressure.”

 

ENDS

 

The WSTA is the UK 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 William Boyack:

Tel:         +44 (0) 20 7089 3884

Mob:      +44 (0) 7948 329001

Email:     [email protected]

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