UK booze tax 49% to French 21%
Wine, the UK’s most popular drink, is enjoyed by 33 million consumers but as a result of the Chancellor’s decision to single-out wine for a duty increase at the last Budget (while holding back excise increases on beer and spirits) income from wine receipts actually decreased from last year’s take, points out the WSTA.
The WSTA stated that for every bottle of average-priced spirit (at 40% ABV) purchased, a whopping 73% or £8.05 goes straight to the Treasury. For an average-priced bottle of still wine, 55% or £2.23 goes directly to the taxman – sparkling wine duty attracts an even higher take at £2.77.
This Christmas 49% of a typical Festive booze shop went on tax.
Wine, the UK’s most popular drink, is enjoyed by 33 million consumers but as a result of the Chancellor’s decision to single-out wine for a duty increase at the last Budget (while holding back excise increases on beer and spirits) income from wine receipts actually decreased from last year’s take, points out the WSTA.
The HMRC Alcohol Bulletin figures released last November showed that wine duty receipts for the last six months were down 2.1% on last year. If the 2.1% drop plays out for the whole year then the UK Treasury would be set to lose £92 million compared to 2018.
For beer and spirits, both of which received a duty-freeze, the Treasury returns were more positive with beer up 2.4% and sprits up 1.7% – further proof that raising alcohol duty is not only bad for business, bad for consumers – but also bad news for the Treasury.
£96.81 of the alcohol spend during the Christmas shop in the UK went to the taxman, courtesy of VAT and the increasingly excessive duty rates in the UK, stated the WSTA.
“Last year consumers paid £92.95 for the average household’s Festive alcohol shop which this year has gone up almost £4 per household despite a freeze on beer and spirit duty,” it pointed out.
“These calculations are based on a typical Festive season shop consisting of five bottles of wine, two bottles of Champagne, two bottles of sparkling wine, three bottles of spirits, two bottles of Port, 24 cans of beer and 12 ciders. If consumers chose average-priced bottles or cans in this shop it would set a UK family back £199.57.”
The WSTA pointed out that the French had much more to celebrate this Festive season as their shop was over £40 cheaper and they paid just £32.46 in tax, meaning only 21% of the cost goes to the taxman.
In effect British drinkers pay 69% of all the international wine duties collected by all 28 EU member states and 25% of all spirits duties. This is by far the most of any member state despite accounting for only 11% of the total EU population points out the WSTA.
“Comparing the wine and spirit tax regime in the UK to that in France puts the UK’s excessively high rate of excise duty firmly in the spotlight,” said WSTA Chief Executive Miles Beale, adding that the Treasury took more money than ever from British businesses and consumers this Christmas while the French booze bill was much more “palatable”.
“By delivering a freeze to beer and spirits at the last Budget the Treasury landed a bumper tax windfall,” he said, “In contrast, after a rise in wine duty the Treasury lost revenue. We are calling on the Chancellor Sajid Javid to support British consumers, pubs and the wider hospitality trade by cutting alcohol duty.”
UK vs France Christmas alcohol costs:
| UK | France | |
| Cost of typical Christmas shop | £ 199.57 | £152.70 |
| Amount of tax paid on typical Christmas shop | £ 96.81 | £ 32.46 |
| Percentage of Christmas shop which is tax | 48% | 21% |
