New visual data illustrates the heavy tax burden on the wine industry

Following the recent Budget announcement in the United Kingdom, the government has confirmed an increase in alcohol duty by 3.66%, in line with inflation. This change, which took effect last week, has prompted concern across the wine industry. Bibendum, a major wine supplier, released an infographic to illustrate how these new costs impact the price of an average bottle of wine. According to their data, excise duty on a 12.5% ABV bottle now stands at £2.87. This figure is just one part of a series of expenses that also include packaging, logistics, VAT, the base price of the wine itself, and Extended Producer Responsibility (EPR) fees.

Jamie Avenell, group buying director at Bibendum, commented on the situation, noting that while the increase was anticipated, it comes at a difficult time for both consumers and businesses. He explained that many people are already feeling financial pressure and that this additional cost will strain everyone involved in the supply chain. Avenell warned that producers are particularly vulnerable, as many have little room left to absorb further costs. He expressed concern that higher prices could reduce consumer choice and make some wines unaffordable for many shoppers.

Industry groups have echoed these concerns. Miles Beale, CEO of the Wine and Spirit Trade Association (WSTA), described the Budget as “death by a thousand cuts” for wine and spirit businesses. He pointed out that companies are still dealing with tax increases introduced earlier in February, which included a shift to taxing wine based on its alcohol strength. Beale argued that there are no winners under what he called a “punishing” alcohol duty regime. He said higher taxes tend to reduce sales volumes, which can ultimately lower government revenue while putting more pressure on businesses and raising prices for consumers.

The WSTA provided further details on how the new rates will affect different types of wine. The average duty on a 13.5% ABV red wine will rise from £2.99 to £3.10 per bottle. For an 11% ABV white wine, duty will increase from £2.44 to £2.52 per bottle. These changes come as part of broader efforts by the UK government to adjust alcohol taxation in line with inflation and public health goals.

Retailers and importers are now assessing how these increases will affect their pricing strategies and product ranges. Some have warned that certain wines may become less available if they are pushed out of affordability for both businesses and consumers. The industry is also watching closely to see if these changes will impact overall wine consumption or shift demand toward lower-alcohol products.

The new duty rates add another layer of complexity for those involved in importing and selling wine in the UK market. With ongoing economic pressures and changing regulations, many in the industry are calling for a review of how alcohol is taxed and regulated to ensure both business sustainability and consumer access to a diverse range of products.