Wine sellers are warning customers that prices could rise and some bottles might vanish from the shelves next year if a new tax system is implemented.
Retailers like Majestic and Cambridge Wine Merchants are reaching out to their customers to brace them for the potential fallout. The new tax rules, scheduled to begin from February 2025, were set in motion by the previous Conservative government. The wine sector has expressed concerns that the changes will drastically complicate matters by introducing over 30 different duty bands.
This will impact wines with an alcohol by volume (ABV) content of between 11.5% to 14.5%, which makeup roughly 80% of the UK market, as per the Wine and Spirit Trade Association (WSTA). A bottle of wine at 14.5% ABV would see its duty jump from £2.67 to £3.09.
Wine sellers have admitted they'll be "powerless" to shield consumers from the impending price hikes if these policy shifts proceed. "Most concerningly for you as discerning wine drinkers, the quality and choice of wine available for you to purchase is likely to be negatively impacted," reads a letter dispatched to Majestic and Cambridge Wine Merchants' clientele.
The correspondence also highlights a serious risk that producers of wines may cease shipping to the UK altogether due to the extra administrative load involved in exporting to Britain. Smaller, family-owned vineyards, the letter cautions, could find it simpler to "easily export their wines elsewhere in the without additional admin or cost".
"Whether your favourite wines increase in price, or disappear from shelves altogether next year, we, as an industry, will become powerless to protect you from that," the statement read. Retailers are now urging the new Labour Government to scrap the former prime minister's plans in the upcoming statement at the end of the month.
Majestic's chief executive John Colley has been actively working with the WSTA to engage MPs and push for immediate reform. "We hope to see evidence on October 30 that the Chancellor has addressed our concerns by reversing the decision of the former government, and helping small business and the industry by extending the wine easement," he commented.
An 18-month "easement" period currently allows businesses to adjust to the new system, taxing wines between 11.5% and 14.5% ABV at a consistent rate per bottle, but this is set to expire on February 1. Laithwaites and The Wine Society are also expected to reach out to their customers regarding these changes.
The Treasury has yet to respond to requests for comment.
