Something to WHINE about?

The Chancellor of the Exchequer announced in her budget that alcohol duty will increase from February 2025 - but what does this mean for Oxfordshire's Wine Merchants?

In the first Labour budget in 14 years, Rachel Reeves made clear that she had to make “hard decisions” when it came to restoring The UK’s financial stability.

As a result, she has had to increase the alcohol duty on wine and spirits.

It is believed these increases come as a way for the government to raise funds to reduce the deficit but also help lower the country’s overall alcohol consumption and prevent alcohol-related diseases, helping to ease NHS pressure in the future.

But what does the decision mean for Oxfordshire’s many independent wine merchants?

The decision to increase ABV will mean that cost prices will go up, which will be passed on to the consumer, making your favourite tipple more expensive.

Alcohol duty is levied on drinks that have an ABV (alcohol by volume) of 1.2% or more. This is paid by the producer or when the goods are imported, however, the consumer ultimately pays this as prices will increase in order to observe this rise.

In line with inflation, all other alcoholic beverages such as wine, spirits and bottles of beer will be subject to a 2.7% increase - meaning a bottle of £10 wine with an ABV of 11.5% or higher the duty will increase by 44p from £2.23 to £2.67.

However, it’s not all bad news.

The rate of alcohol duty on draft drinks served in hospitality venues such as pubs and bars will see a reduction of 1.7%. The government is doing this to “support the hospitality industry, particularly recognising the role that pubs play in communities”.

According to Pint Prices, the average cost of a pint across the whole of the UK is £5.67. In London, the average price is above £6, even in the cheaper areas of the capital.

With the average pint in Oxford city centre being £5.52, the price of a pint should fall to around £5.43.

A very glass-half-full outlook on a magnum-sized issue - but it’s better than nothing.

But businesses are worried for their future.

Bar manager of The Rectory in Birmingham, Johnathan Radcliffe said, “It was a slight win for an already very difficult budget”.

Describing his establishment as a “draft heavy pub”, with the alcohol tax increasing, Johnathan adds that “we will see a rise in prices” for around “40% of the trade [they] get” for wines, cocktails and spirits.

Nevertheless, the facts remain: the overall price of alcohol will increase under Labour and for many, they may have already bottled it.