Wine Duty

Dear constituent,

Thank you for contacting me about wine duty.

I know that this issue will be of concern to many people in our area. Indeed, a YouGov in 2019 found that, among adults who drank alcohol in the previous 12 months, 81% drank wine. Additionally, almost 30% of those surveyed said it was their drink of choice.

As you know, the Government has consulted on a reform of the alcohol duty system. Under its proposals, the various existing rates of duty for still and sparkling wine will be replaced by a system where all alcohol products will be taxed according to the litres of pure alcohol they contain, with a standardised series of rate bands. The Government says it believes this will produce a “simpler, fairer and healthier” alcohol duty system. It further states that it believes it is right for wine to be taxed in proportion to its strength, as is already the case for beer and spirits. It says its reforms will result in lighter still wines below 11.5% ABV and many sparkling wines becoming cheaper, while higher strength still wines will pay more duty.

However, I know that wine and spirit businesses and consumers have a number of concerns about the proposed reforms. Wine Drinkers UK, for example, has highlighted that they will mean the top selling red and white wines see increases in duty, while the top selling beers will see no change.

The Wine and Spirit Trade Association, meanwhile, has expressed concern that taxing wine by strength will be “complicated, costly, and impractical”, as well as that the proposed new duty system will continue to tax wine and spirits “more harshly” than other categories of alcoholic drink. I know that it has called for the Government to reduce the differences between rates paid by different categories of alcohol and to tax all wine between 8.5-15% alcohol by volume at one rate fixed in the midpoint of the band (12%).

The Government’s consultation on this issue closed on 30 January and it states that it is currently analysing responses received. I hope it will give proper consideration to the concerns raised by wine consumers and businesses as it does so. I can assure you that I will continue to monitor this issue.

Thank you once again for contacting me.

Yours sincerely,

Peter Dowd MP