UK budget: Chancellor courts wine drinkers with tax freeze

UK chancellor George Osborne has extended a pre-election charm offensive to wine drinkers by announcing a freeze on duty tax in 2015 - but the chart below shows half of the cost of a bottle still goes to the government.

Image: Bibendum’s graphic illustrating where your money goes on a bottle of wine

Osborne announced the freeze to Parliament in his Budget speech today (18 March), the final one prior to the UK General Election.

Wine has not received a tax cut since 1984, according to the trade’s Drop the Duty campaign, but news of the duty freeze has still gone down well. In last year’s budget, while the so-called ‘escalator’ of predetermined annual increases for alcoholic drinks was scrapped, wine duty still rose with inflation.

This year, wine still fared worse than other drinks, with duty on spirits and cider being cut by 2% and beer by 1p per pint. The UK has the second highest rate of wine duty in the EU, after Ireland.

Miles Beale, chief executive of the Wine & Spirit Trade Association (WSTA), said he was ‘disappointed that the UK’s 30m wine consumers did not receive a duty cut’. But, he said the freeze was still a ‘first step towards supporting wine businesses that are looking to invest in the UK, create jobs and back British pubs’.

Written by Ellie Douglas