UK Duty on Wine up 46% in 4 Years

6 June 2012 by Gavin

”Today, I have no further changes to make to the duty rates set out by my predecessor.”

George was at it again in this year’s Budget. Of course, the Chancellor could have said “Duty on alcohol will increase by 2% above the rate of inflation, as put in place by the previous Government” but the news channels would have picked up on that bit of bad news.

The official Budget document doesn’t really say what the actual increase is. “As announced at Budget 2008, and extended in March Budget 2010, alcohol duty rates will increase by 2 per cent above the RPI. These changes will come into effect from 26 March 2012.”

Anyway, here are some numbers and a few updated graphs.

1. The duty on still wine goes up on 26th March 2012 from £1.81 to £1.90 a bottle, plus VAT on the duty as well as the wine.

2. Including VAT, that’s an 11p increase, to a total of £2.28 duty per bottle. (Or £22.80 a case, plus VAT on the duty = £27.36 duty per case.)

the March 2008 Budget, duty on wine was £1.56, so we’ve seen an increase of 46% in just 4 years. In the 8 years before that, duty went up 15% in total.

4. Duty is counted as part of the cost price by retailers and merchants, so one would expect to see prices rise by more than the 11p if margins are maintained.

5. Duty on sparkling wine has gone up to £2.43 a bottle plus VAT (£2.92) – £35 a case. Bloody Nora.

Brits have little idea that duty on wine in many EU countries is almost non-existent. The 11p duty rise alone is more than the total duty on a bottle in France, Germany, Spain, Portugal, Italy and Austria put together.

How fair is that?