New UK Wine Duty Increases: The Enemy of the Vine

The UK wine industry has failed in our collective attempts to persuade the Government to commit to making the temporary easement for wine between 11.5-14.5% permanent ahead of its planned expiry on 1st February 2025. As the industry highlighted ‘It is vital that the Government acknowledges that withdrawing the easement would create significant and unnecessary one-off and ongoing running costs, as well as imposing unmanageable operational complexity. Making the easement permanent would maintain one fixed duty payment for over 85% of wines across the UK market.’

“So today, we are taking advantage of leaving the EU to announce the most radical simplification of alcohol duties for over 140 years.” Rishi Sunak’s Budget speech as Chancellor, October 2021.

Allegiances aside, and as with most words that come out of politician’s mouths – this is utter nonsense and could not be further from the truth. The new duty system is complex and wholly burdensome from the importer, each receiving warehouse, and to all sales channels. How increasing duty rates is ‘taking advantage of leaving the EU’ is beyond baffling. 

Prior to last August, UK duty on ‘still’ wine between 8.5% and 15% was £2.23 and £2.86 for sparkling wine, plus VAT of course. Sunak, as Chancellor, introduced the new method of taxing wine based on the percentage of alcohol however, and after widespread opposition, the Government realised that the administrative burden on the wine trade was so huge that when the new system was brought in last summer there was a temporary stay of execution on wines between 11.5% and 14.5% (85% of all wine according to the Wine and Spirit Trade Association). A fixed rate of £2.67 on wines in this bracket was to run from 1 August 2023 to 1 February 2025.

Even with the temporary easement for 11.5%-14.5%, the UK has one of the highest levels of duty in Europe. As from 1 February 2025, the UK will have the highest duties in Europe for any wine of 13% or more, and by far the most complicated duty system imaginable. Port and sherry have been hit the hardest, with a port of 20% abv going up from £2.98 duty to £4.28 plus VAT.

Does 54-pence increase make much of a difference to a bottle of Standish or Utopos? That’s purely down to personal feelings however, what about one of the UK’s biggest selling wines from South Australia, Yellow Tail Shiraz, which Tesco sells at £7.75 per bottle (I believe the alcohol is 13.5%). Often, most supermarket wine offerings are available with a 25% discount. Circa 45+ weeks of the year.

UK tax for all wines around £8:00 equates to 50% of the sale value. Add the cost of the bottle, packaging, shipping, the profit margin for the retailer and you are left with circa 80-90-pence to cover the cost of the liquid and the people that produce it. Grim reading and grim quality. The more you pay, the better wine you get, which is obvious, but only to a point – a subject best left for another day.

Reducing alcohol has many benefits from savings on the new, duty rates and one’s health (so I am led to believe) however, I am a staunch advocate of flavour, balance, and who knows what tomorrow may bring (best I open another bottle!).

Picking grapes earlier in the season will certainly reduce a wine's ‘potential’ alcohol content however, and if your primary concern is to produce the best wine you possibly can, this is not an option as a decrease in sugar versus an increase in acidity makes for something rather horrid. You also lose flavour and palate feel…

Global warming is a huge factor and reason why many wines from the Barossa comfortably reach 14.5%. ‘Cool’ wine growing regions are warming up, as are the alcohol levels, and it’s only going to get hotter.

So, how can you lower alcohol in wine without ruining the product…?

Boiling wine removes much of the alcohol however, it seriously affects the taste. Non-alcoholic wine brands that use heat to remove the alcohol in their wines do so very carefully, making sure not to cook the wine (remember our Dave Powell offer that failed to materialise due to poor, and very hot storage conditions? The wines were brown, sweet and ‘cooked’). Reverse osmosis is growing in popularity as a preferred dealcoholisation method for alcohol-removed wine brands, as is the Spinning Cone Column method.  There are others which are all highly technical.

Good winemaking starts in the vineyard and ends in the bottle. The steps in-between are relatively simple however, and leaving science behind, a winemaker works with nature and not against it. Achieving the correct level of ripeness is essential, as is picking early in the morning or during the night. Acidity is essential as it provides balance and freshness, but too much is harsh, and too little provides ‘flatness’. Alcohol does increase flavour and mouthfeel - the higher the alcohol level, the fuller the body, but wines with excessive levels feel ‘hot’ (alcohol burn) and often cloying. They certainly lack balance and freshness. It is not unusual to find gastro-centric restaurants impose an ABV limit on their wine lists. Of course, the lower the alcohol the more their punters can drink before they sway out of the door!

For me - it’s all about balance. I demand great flavour, texture, freshness and sensible use of oak and tannin regimes. If this can be delivered, then I am very happy and care little for the alcohol content (save that is going to cost me more from 1 February…)

We have received many emails from customers requesting more Grant Burge Shadrach. Sadly, we’ve sold the lot and there are no further stocks in Accolade’s stash. We have topped-up on our biggest seller of ’25 – the 2016 Meshach which will be arriving at our HQ warehouse late, next week. Please note dispatch dates. We have ringfenced all Meshach stocks and will top-up as and when you / we run low, but numbers are not limitless… In addition, we are now offering the Meshach to our trade contacts, and sales are strong.

We launched 480 bottles of the super-delicious Corryton Park Cabernet Sauvignon on Tuesday. I believe we sold-out within 24-hours. We are negotiating with Accolade for more stocks, as we are aware that some of you missed out. May I suggest making use of our ‘email me when back in stock’ button as you will automatically be notified ahead of others.

I had planned to sample both Stonier wines as up to date tasting notes are very much needed. Alas, I am waist-deep in new, wine arrivals (Torbreck, Fermoy and Rob Hall) together with on-going talks with our friends, Accolade wines.

We have purchased all stocks of Houghton C.W. Ferguson Cabernet Malbec 2020, which and as you can see from the below, is highly prized and highly respected by many. At this price – we do not expect stocks to last for long. This is the only place (outside of Oz) where you can purchase this beauty. I wouldn’t bother making use of our 'email me when back in stock’ here, as this is your lot!

We have also added two, new wines from St Hallett. The inaugural vintage of the ‘Mighty Ox’ en-magnum only and an old favourite, Old Block Shiraz.

A new collection of samples from Accolade arrives on Monday including two vintages of Hardy’s HRB Chardonnay, which has not been available in the UK for far too long. Fingers crossed and keep your eyes peeled for their potential release mid-week. 

Wishing you all a fabulous weekend. 

Cheers,
Stu