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WSTA welcomes Alcohol Duty Review delay

Published:  22 July, 2022

Following months of lobbying from the trade, the government yesterday (July 20) delayed its alcohol duty review till the Autumn.

The divisive proposals were first announced during the October budget by then Chancellor Rishi Sunak. He described the changes as the “most radical simplification of alcohol duties for over 140 years”.

The proposed changes would introduce 27 bands (as opposed to three) for alcohol across wine categories, thus adding to the inflationary pot for the sector. 

The Wine & Spirit Trade Association (WSTA) welcomed the decision to delay. Miles Beale, WSTA CEO, said: “The government’s plans to delay responding to the alcohol duty review until the Autumn is a welcome and sensible pause. We look forward to engaging with the new chancellor and their treasury team to ensure that plans for changing the alcohol tax are fairer, more straightforward and are delivered with less red tape. 

“With inflation continuing to climb to its highest rate for 40 years, we hope that by working with the new treasury team, we can ensure that this once-in-a-lifetime chance to reform the system does not add to consumer misery and bring with it higher prices and less consumer choice.”

According to the WSTA, if wine were taxed according to its alcoholic strength, 70% of all still and sparkling wine would go up in price, as would 80% of all still wine, 95% of red wine and 100% of fortified wines.

The Scotch Whisky Association (SWA) also praised the government’s decision to pause the review. 

SWA director of strategy Graeme Littlejohn said: “The SWA has long called for fairer excise duty in the UK, but the reformed system announced by the treasury last autumn increased the competitive disadvantage faced by Scotch whisky producers.

“The pause of the alcohol duty review will give the new chancellor and treasury team time to reflect and ensure that the reformed system lives up to the promise to support the Scotch whisky industry.

“There is no reason why a unit of alcohol served as Scotch whisky should be taxed up to 245% more than a unit of alcohol served as cider. A unit is a unit, and consumers who enjoy spirits like Scotch whisky responsibly should not be forced to pay over the odds.”