Industry chiefs put case to Treasury

Published: 05 February, 2009

Some of the drinks industry's biggest producers, including Constellation Europe and E J Gallo, met with Treasury minister Angela Eagle this week to call for an urgent rethink of the Government's escalator tax on alcohol.

Toy Christensen, president of Constellation Europe and George Marsden, vice president Europe of EJ Gallo, joined Jeremy Beadles, the Wine and Spirit Trade Association's chief executive to warn excessive increases in excise duty - 17% in the last year alone - are forcing wine businesses to cut jobs and investment in the UK.

Constellation has already announced 50 job losses and Gallo is consulting with a similar number of people in the UK.

The delegation told Eagle the four-year year tax escalator on alcohol would push some sections of the industry over the edge. Christensen said the Government's approach means businesses can no longer look on the UK as a stable environment in which to invest. These remorseless tax increases are already forcing the industry to cutback."

Marsden at Gallo added: "The UK wine industry has reached a tipping point and with sales declining the Government is making a bad situation worse. It's time for a rethink before the industry is put in further jeopardy."

Jeremy Beadles said: "The drinks industry seems to be the only business sector which doesn't merit Government help and instead faces increasing taxation during a recession. Smaller businesses in the wine sector are already facing cash flow problems and the tax changes look set to push some to the wall this winter.

"We're not asking for special measures - just an end to the punishment no one else is getting."

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