𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Bottles of wine and spirits could rIse by £1 next month as industry leaders warn new alcohol duty hikes will fuel inflation and drive up costs for households already struggling with higher prices.

The Wine and Spirit Trade Association (WSTA) has urged the Chancellor, Rachel Reeves, to scrap plans to increase alcohol duty in next month’s Budget.

A rise based on the retail price index, estimated at 4.5 per cent, would add 14p to a bottle of Prosecco, 16p to red wine and 47p to gin.

WSTA chief executive Miles Beale described the hikes as “crippling” and warned another increase would “pour away Treasury funds” while pushing prices higher for consumers.

He added: “Alcohol sales have been in steady decline since 2023, following the largest alcohol tax hike for 50 years. Instead of bringing in more cash to plug the black hole in public finances the Government is reducing tax take and fuelling inflation.”

The industry group said recent rises in National Insurance, minimum wage rates and a new “glass tax” had created a “perfect storm of crippling costs”. It warned that further duty hikes would push prices up by around £1 on bottles of wine and spirits compared to January this year.

Mr Beale said the Government’s policy of repeated increases was driving down sales and reducing tax revenue. “The only way to break the cycle of tax duty increases penalising cash-strapped consumers, depleting Treasury funds and fuelling inflation is to freeze excise duty on wines and spirits at the November Budget,” he said.

A poll conducted for the group found that 72 per cent of drinkers believe prices in shops have soared in the last year, with 74 per cent saying they’d also gone up in pubs. Of those noticing the rise, more than a third said they were buying less alcohol in shops and more than half were cutting back in pubs and bars.

Global wine company Treasury Wine Estates, which owns brands including 19 Crimes and Penfolds, said the sector could not take more increases. Managing director Angus Lilley said: “Across the UK, community pubs, restaurants and wine retailers are already feeling the strain from rising costs. Further tax increases will only deepen the pressure.

“Higher costs mean tougher choices for local pubs, higher prices on the menu, and less money flowing through the hospitality sector that keeps towns and cities vibrant.”

He urged ministers to “choose stability” by freezing alcohol duty and supporting a plan that keeps prices fair and protects jobs.

Fortitude Spirits chief executive Ed Cottrell said another duty rise would be “a disaster” for domestic producers. “Another duty hike on top of last year’s highest for 50 years, combined with EPR and higher employment and energy costs, is choking UK-based spirits manufacturing businesses,” he said. “The result will be fewer companies operating and employing in the UK.”

Benjamin Elks, grassroots development manager at the TaxPayers’ Alliance, said: “Plans to increase alcohol taxes will be a hammer blow to establishments that are often at the centre of local communities.”

He added: “The hospitality industry has been crippled by recent tax hikes, driving up prices and leaving customers having to dig ever deeper just to afford a drink. The Chancellor should immediately rule out further tax rises on alcohol and give some relief to hard-pressed businesses and taxpayers looking to enjoy their favourite tipple.”

The Treasury was approached for comment.