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Alcohol duty increase ‘historic blow’ to wine and whisky industry

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The price of a bottle of wine could increase by 44p from this summer after the chancellor opted to freeze taxes on beer but signalled punishing increases for wine and whisky.Jeremy Hunt promised a “Brexit pubs guarantee” in his budget, with the discount rising from 5% to 9.2%, although the chancellor offered scant detail on a longer-term pledge of a “Brexit pub guarantee”.The duty cut will shave 11p off draught beer compared with beer sold in supermarkets. “British ale is warm but the duty on a pint is frozen,” the chancellor quipped.Wine and whisky producers failed to see the funny side as they were left reeling by a double-whammy of soaring duties, warning the chancellor’s plans would “stifle British business”.A blanket alcohol duty freeze will end on 1 August, meaning levies will rise in line with inflation at 10.1%.

The effect on prices will be coupled with increased duty on higher strength drinks planned as part of reforms of alcohol duty unveiled in 2021.This will mean a 44p increase in the price of a bottle of wine with an ABV of more than 12.5%, according to the Wine & Spirits Trade Association (WSTA), while a bottle of vodka could rise by 76p and port lovers will be £1.30 out of pocket per bottle.A smaller number of drinks will go down in price, including 14p off a 5% pre-mixed can of G&T and 7p off sparkling wine at 12%, while the government has said there will be transitional arrangements for the hardest-hit products.Nevertheless, the WSTA chief executive, Miles Beale, warned that the “crippling” rises in the price of most drinks would further fuel inflation.“It will heap more misery on consumers.

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