Wine sellers in the UK are cautioning customers about potential price hikes and the disappearance of certain bottles from shelves as a result of upcoming tax changes. Retailers like Majestic and Cambridge Wine Merchants are reaching out to their customers to alert them to the potential impact of the new tax rules expected to take effect from February 2025. These changes stem from plans introduced by the prior Conservative government, which will introduce over 30 different duty bands, complicating the system significantly.
The wine industry has highlighted that these changes will particularly affect wines with alcohol content ranging between 11.5% to 14.5% ABV, which constitute about 80% of the UK market, according to the Wine and Spirit Trade Association (WSTA). For instance, duty on a bottle of wine with 14.5% ABV is projected to increase from £2.67 to £3.09. Wine sellers have expressed concern that they will be unable to shield consumers from price increases if the policy adjustments move forward.
A letter sent to customers of Majestic and Cambridge Wine Merchants mentioned, “There is a genuine risk that the producers of your favourite wine will stop shipping it to the UK entirely, due to the additional administrative burden that will be involved in exporting wine to Britain.” The letter also highlighted that smaller, family-run vineyards could find it easier to export their wines to other parts of the world without incurring additional administrative burdens or costs.
Retailers are urging the new Labour Government to reconsider the previous government’s plans during the Budget statement by the end of the month. John Colley, the chief executive of Majestic, indicated that they have been collaborating with the WSTA to engage with Members of Parliament and advocate for immediate revisions. The current 18-month “easement” period, which levies a flat rate per bottle for wines between 11.5% and 14.5% ABV, is set to conclude on February 1.
Other retailers like Laithwaites and The Wine Society are also expected to inform their customer base about these impending changes. The Treasury has been approached for comment regarding this matter. Wine enthusiasts and consumers are advised to stay informed about these potential adjustments, as they could have a significant impact on wine availability and prices in the UK market.