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Wine Drinkers UK call for wine duty freeze

Published:  07 October, 2021

A combination of climate change, labour shortages and increased shipping costs are threatening Britain’s wine supplies, with price rises likely to follow, Wine Drinkers UK (WDUK) has claimed.

In response, the group which is a collection of wine lovers, makers and sellers, is calling on the government to commit to freezing wine duty at the upcoming Budget, in a show of support for industry and wine drinkers.

Its call follows that of The Wine & Spirit Trade Association, which earlier this week called on the Treasury to freeze wine and spirit duty and extend the hospitality VAT reduction in the Autumn Budget to allow the country to climb out of the Covid-19 slump.

This is not the first time WDUK has called for tax breaks for the wine sector. At the beginning of the year it renewed calls for the government to recognise wine as the UK’s favourite drink by cutting increasingly burdensome taxes.

Wine writer, broadcaster and WDUK supporter, Helena Nicklin said: “Around 99% of the wine we consume in the UK is imported so the UK’s wine drinkers are going to feel the impact of this perfect storm hitting the sector.

“Currently more than 50% of the price of a shop-bought bottle of wine goes straight into the Treasury’s pocket. It is time we see a show of support in the upcoming Budget for this industry that generates £11bn annually for the UK economy in sales alone.”

WDUK said that as French, Italian and English wines have been hit by extreme weather and failed yields, Californian wines have been affected by wildfires and New Zealand is feeling the impact of its closed borders with a shortage of harvest labourers, it is a challenging time for the industry.

It highlighted data including that from New Zealand Winegrowers that revealed regions throughout the middle of the country – including Wairarapa, Marlborough, Nelson, and North Canterbury – have yields down over 20% on 2020.

David Gates, CEO of Direct Wines, said: “Reliable weather is of course fundamental to winemaking, and we’re very concerned by what we’ve been hearing from our network of 427, mostly family, wineries around the world. Following the struggles of Covid-19, a string of very challenging harvests across multiple regions is proving incredibly tough for many.”

Chris Stroud, market manager Europe, New Zealand Winegrowers, adds: “New Zealand Sauvignon Blanc is one of Britain’s favourite wines but there’s a very real possibility that consumers will find it harder to get their hands on it this winter.

“The strong demand coupled with a significant shortfall in vintage, as the combination of labour shortages and increased shipping costs hits supplies, means that there will be tough decisions to make to meet the demands of trade customers, retailers and consumers.”