The WSTA campaigns each year to ensure a fairer tax environment for the wine and spirit industry in the UK. In 2019, the Chancellor heeded calls from the WSTA and wider industry and passed on a welcome freeze in spirits duty, although he also levied an increase on wine, increasing the price by 7p per bottle of still wine and 9p per bottle of sparkling wine. In the Spring 2020 and Spring 2021 Budgets we secured a freeze on both wine and spirit duties.

 

Whilst the freeze in the March 2021 Budget was a necessity, pressures on the hospitality industry and its supply chain mean the UK wine and spirit industry is unable to meet its full potential – held back by a punitive duty regime.

In 2019/20, UK wine and spirit businesses and consumers paid £8.2bn in duty, accounting for 67% of revenue collections despite accounting for less than a quarter of total alcohol clearances. Consumers now pay £2.23 per bottle of still wine and £8.05 for every bottle of spirit (40% ABV) and duty rates remains so high that 55% of the average priced bottle of wine and 73% of the average priced bottle of spirit is taken up in duty and VAT.

As part of the UK Government’s Alcohol Duty Review, the will work with government to achieve a simpler, fairer system of alcohol taxation. Since 2010, duty has increased some 39% on wine, 27% on spirits, and 16% on beer.

Even before the onset of Covid-19, 2020 represented, for many members with complex global supply chains, the most challenging year ever. Preparations for the end of the Transition period on 31st December, a difficult trading environment across both the on and off-trade, and increasing global tensions that threatened export growth all served to heighten the challenge. For many WSTA members, any ambitions for growth or exports had to be placed on hold. The outbreak of COVID-19 served only to exacerbate the scale of the challenges facing our sector, and measures aimed at limiting the spread of the virus had a devastating impact, both on hospitality businesses that were forced to close, and wine and spirit businesses that supplied the on-trade. Whilst many businesses adapted to find alternative channels for trading, the closure of the on-trade has inevitably hit a number of our businesses revenues and employment.

When the government’s vaccination programme has been rolled out and strict measures on businesses are lifted, the wine and spirit industry wants to be in a position to help the government to build back better. To do this, businesses in our sector and the hospitality industry we supply need support.

For more information on the WSTA Budget campaign, view our latest news stories below, and follow us across our social media channels – Twitter and LinkedIn.

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