Sunak’s ‘fairer’ tax system to spike wine prices

Britain’s most popular bottles of wine are set to see a sharp price rise soon due to tax changes proposed by Chancellor Rishi Sunak, stated a recent report.

Unveiling his autumn budget last year, Sunak, claiming to make alcohol duty ‘fairer’, vowed to simplify the system, calling it “outdated and full of historic anomalies”. The new system is expected to come into force from February 1, 2023 and is subject to a consultation which ends on January 30 this year.

Under the new system, the super-tax that applies to sparkling wine, prosecco and champagne will be abolished. However, experts are claiming that the changes come with a “sting in the tail” for those who enjoy wine with a high alcohol – or ABV – level above 11.5 per cent.

According to a research by Wine Drinkers UK (WDUK), about 95 per cent of the most popular wines will suffer a hike in prices as a result of the change in tax system, affecting drinks with an ABV above 11.5 per cent. 

Red wines such as Hardy’s Shiraz (14 per cent) would rise by 58p to £7.58, while Barefoot Merlot (13.5 per cent) would rise by 47p to £7.22.

Whites such as Hardy’s Crest Chardonnay (13 per cent) would rise 35p to £7.35 and Casillero del Diablo Sauvignon Blanc (13 per cent) would go up 35p to £8.35, MailOnline reports.

On the other hand, weaker drinks like many rose wines and liqueurs which are currently considered over-taxed, are expected to become cheaper.

Last month the UK Spirits Alliance, which represents over 160 distillers, said Sunak’s plans will not create a ‘level playing field’ for the drinks industry by highlighting that imported booze such as Italian prosecco will be cheaper thanks to a duty cut of around 25 per cent, while home-grown spirits such as Scotch whisky and English gin will be taxed at current rates.

WDUK, a coalition of trade and hospitality industry bodies, sellers and experts, is said to be fighting the changes.