WSTA urges Treasury to halt alcohol tax escalator

Published: 03 February, 2011

The Wine & Spirit Trade Association WSTA, is urging the Treasury to abandon its alcohol tax escalator on the back of a UK decline in 2010 retail wine figures.

The Wine & Spirit Trade Association, WSTA, is urging the Treasury to abandon its alcohol tax escalator on the back of a UK decline in 2010 retail wine figures.

It says figures supplied by ONS showed sales of wine were down 2% and sales of spirits flat.

WSTA chief executive Jeremy Beadles, said the tax escalator threatens to deliver a 6.8% tax increase on alcohol next month, which if it goes ahead it would mean that in just three years tax on wine had increased by 35% and tax on spirits by 30%.

He added: "With the recent VAT increase adding to the weekly shopping bill, it's no time to force drinks prices up further with another inflation busting tax increase.

"The scale of tax rises on wine and spirits in recent years has cost thousands of jobs and made matters worse for households struggling to cope in difficult economic circumstances.

"Abandoning the tax escalator would help hard-pressed consumers and a sector which ought to be part of the drive to restore economic growth in the UK."

The 2010 retail data provided by Nielsen and CGA Strategy shows that sales of wine and spirits fell in pubs and restaurants (down 4%) and shops (down 1%) .

The WSTA said against this backdrop the small increase in the value of wine sales (up 3%) reflects the impact of tax increases while industry has had to absorb rising costs of energy, transport and raw materials.

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