Beer prices may be down a meagre 1p a pint, but wines prices will rise by up to 42p a bottle when complex new tax bands for wine come into force from 1 February, warns Alex Baulf, head of global indirect tax at Avalara
Wine retailers and businesses have sounded the alarm over the detrimental effects of impending alcohol reforms. It all dates back to August 2023 when Rishi Sunak’s Conservative government introduced a new alcohol duty rate, the first of its kind in 50 years.
Under this reform, wines will no longer be taxed by type, instead they will be taxed by alcohol volume (ABV). Due to the substantial impact on businesses and consumers, there was an 18-month easement period, under which wines between 11.5% and 14.5% ABV would pay £2.67 in tax, which is the 12.5% ABV duty rate.
There was hope that the new Labour government would overturn this reform, however, this has not happened, and the easement period ends on 1 February 2025.
