It’s not been widely publicised but next Tuesday, 1 August, the way the UK Government taxes wine and spirits will change and – surprise, surprise – most prices will go up. At present, £2.23 of the amount you pay on any bottle of still wine goes straight to the Government as duty. This figure is the same whatever the price and whatever the alcoholic content of the wine. So, whether you buy a £5 bottle of Liebfraumilch with 11% alcohol or a £500 bottle of Châteauneuf du Pape with 15% alcohol, the rate of duty is the same, £2.23 (plus VAT, of course). From next week, this will change. The price of the bottle still doesn’t matter (‘not fair!’ I hear you cry) but the alcoholic strength does. The Government’s aim is, ultimately (in 2025, they say), to tax all alcoholic drinks based on their exact alcoholic strength but, for now, they are dividing wine into 4 categories. Let’s look at how prices will be affected. (I’m quoting prices per bottle but, if you buy your wine by the glass in a pub or restaurant, the same increases will apply proportionately).
To start, the good news: the few bottles containing 11% alcohol and below will be slightly cheaper, as will sparkling wines, which were previously taxed at a higher rate than still wines. These will now attract the same rate of duty, reducing the price of fizz by 19p a bottle (I always thought that Government ministers were Champagne drinkers!), or 50p a bottle if, like many Proseccos, they have less than 11.5% alcohol.
Virtually all other wines will go up. Those with alcohol levels between 11.5% and 14.5% (the vast majority of all wine sold) will rise by 44p a bottle, while wines at 15% alcohol and upwards (including all sherries) will rise by 97p a bottle. And finally, for those (like me!) who love their port (which is, of course, around 20% alcohol), we will have to pay an extra £1.30 a bottle.
Not good news, but those are the facts. No wine recommendations this week, just a very strong hint to get down to your local wine shop now – or pay the price for delaying!