Chancellor Phillip Hammond Increases Wine Duty
The UK Chancellor Phillip Hammond has increased duty on wine. The UK already has the second highest duty in the whole of the EU.
The Wine & Spirits Trade Association's recent survey shows 62% of UK consumers believe duty on wine is 'too high'.
Duty on a 750ml bottle of wine will increase by 8p to £2.16, and by 10p for sparkling wine, up to £2.77. Wine duty also increased last year and was the only alcohol beverage to go up in both 2015 and 2016.
In a £5 bottle of wine as little as 36p might be on the actual wine itself with alcohol duty by far the largest chunk of the bottle at £2.18. Other costs include margin, VAT, packaging and logistics. That means the value of the wine is just 7% of the bottle you buy with around 55% going straight into Duty and VAT.
By upgrading to a £15 bottle of wine the value of the wine increases dramatically, reaching as high as £5-£6, making up over 33% of the total value of the wine in bottle. So you get much more quality wine for your money in the higher brackets. This might explain the trend for people to 'drink less but drink better'.
Furthermore, the dwindling value of the pound since Brexit means wine prices will inevitably climb again in the coming months.