Concerns raised over potential increase to alcohol duty

An increase to alcohol duty may be on the cards in next month’s budget, according to reports.

The Telegraph revealed that Chancellor Rachel Reeves is considering raised taxes on beer, wine and spirits as part of a plan to balance the books.

It comes after the government said it needed to fill a £20b black hole in public spending in July.

The Wine and Spirit Trade Association (WSTA) has subsequently called for a two-year freeze to alcohol duty amid declining alcohol sales and rumoured price hikes.

Stating HMRC figures, the WSTA said there was a £1.3b (10%) drop in revenues to the exchequer between September and August following the changes to the alcohol duty system introduced in August 2023.

Miles Beale, chief executive of the Wine and Spirit Trade Association, said: “Last year’s damaging reforms to the alcohol excise duty system, including the largest single duty hike in almost 50 years, have hit businesses, consumers and the government purse. 

“Freezing duty for at least two years and avoiding imposing damaging additional costs and red tape by maintaining the wine easement, will benefit businesses and consumers by driving growth and keeping prices stable while optimising government income. In short, a freeze won’t cost government anything, but it will be financially beneficial to the Treasury, British business and consumers.”