Britons are facing higher prices for their preferred alcoholic beverages starting today due to an increase in alcohol duty, following the conclusion of Dry January. The rise in alcohol duty, in line with RPI inflation, amounts to 3.66%. As a result, consumers can expect an additional 11p on a bottle of Prosecco with 11% alcohol by volume (ABV), 14p on a bottle of red wine with 14.5% ABV, and 38p on a bottle of gin with 37.5% ABV, according to the Wine and Spirit Trade Association (WSTA).
The decision to raise alcohol duty was finalized during last year’s Autumn Budget. Wine and spirits industry leaders have highlighted the necessity of price increases to sustain their businesses. Last year, drinkers experienced a 3.6% surge in alcohol duty, leading to an extra 54p on wine and 32p on gin per bottle, while draught duty saw a reduction of 1.7%, equivalent to a penny off a pint.
Additionally, a new taxation system based on the strength of wine was introduced, resulting in a £1.10 increase in tax on a bottle of 14.5% red wine since the recent alcohol duty structure was implemented in August 2023. Alcohol duties are influenced by the potency of beverages, prompting several beer brands to reduce their strength to lower expenses.
Emma McClarkin, the chief executive of the British Beer and Pub Association, expressed concerns about the likelihood of further price hikes due to the recent changes. Miles Beale, chief executive of the WSTA, emphasized the complexities of price adjustments, particularly for wine taxed by strength, adding to the operational challenges faced by businesses.
Overall, the alcohol duty increase is perceived as necessary for maintaining the financial stability of public services, as stated by a Treasury spokesman. The detailed figures provided by WSTA illustrate the price differences before and after the alcohol duty rise for various alcoholic drinks.