Alcohol duty in the UK has been frozen since February 2019, but in March this year the Government announced that this is to change as of 1st August 2023 when their new duty legislation will go live.
Who is likely to be affected
Individuals and businesses involved in the manufacture, distribution, holding, sale and consumption of alcoholic products.
General description of the measure
The measure makes changes to the duty structure for alcoholic products, creating a standardised series of tax bands based on alcohol by volume (ABV).
The measure also introduces two new reliefs and a temporary easement for certain wine products. Small Producer Relief replaces and extends the relief currently enjoyed by small breweries to all producers of other alcoholic products.
Draught Relief will reduce the tax burden on alcoholic products sold in the on-trade venues, such as pubs, by reducing the tax rate on draught containers containing at least 20 litres of qualifying alcoholic products.
The easement for wine producers and importers helps manage the transition to the new method of calculating the duty owed on their products. This easement will be in place for 18 months.
Finally, the measure harmonises the approval, return and payment processes for domestic producers of alcoholic products.
Some parts of the current legislation that are outdated will be removed and other parts of the Alcoholic Liquor Duties Act 1979 (ALDA) and Finance Act 1995 will be re-enacted so that most of the primary legislation relating to alcoholic products is contained in one place.
What this means
The aim of this new legislation is to create standardised alcohol duty bands across all types of producer (beer, spirits, cider, still and sparling wines, as well as other fermented beverages), with taxes calculated based on the litres of pure alcohol in the product.
This will reduce the number of tax bands from 15 to 8 but does represent the biggest change that the UK alcohol industry has experienced since 1975.
Presently, Duty on wine is charged at £2.23 per bottle still wine and £2.86 for sparkling. Fortified £2.98 and Spirits above 37%abv £7.54
From the 1st of August. Duty will be charged as thus:
STILL
8.5% abv £1.82
9% abv £1.92
9.5% abv £2.03
10% abv £2.14
10.5% abv £2.24
11% abv £2.35
11.5 – 14.5% £2.67
15% abv £3.21
SPARKLING
8.5% abv £1.82
9% abv £1.92
9.5% abv £2.03
10% abv £2.14
10.5% abv £2.24
11% abv £2.35
11.5 – 14.5% abv £2.67
15% abv £3.21
FORTIFIED
15% abv £3.21
20% abv £4.28
SPIRITS
37.5% abv £8.31
PLEASE BE AWARE! This is the increase of Duty alone and does not reflect any additional cost increases that could be incurred such as costs of goods and new shipping rates.
Whilst there will be increases to some of our range, at Guest Wines we want to keep our prices keen and competitive as possible, and as such, we will continue to source wines that are of high quality whilst being good value for money.
If you want to beat the price changes, then now would be a good time to hop over to our Online Store where you’ll find yourself a bargain or two to explore!
