In the wine sector, the present rate of duty is identical for wines from 5.5% to 15%. This allows tax on a unit of alcohol to be much lower in wines that have a higher overall alcohol content. For example, wine at 14% abv is charged exactly the same rate of duty as wine of only 7% abv. There is therefore no economic incentive for consumers to change their pattern of consumption and to consider buying lower abv wines.
Our research tells us a significant number of consumers would be motivated to explore a choice of less alcoholic wines if aware of a tax benefit of this kind. At Sovio Wines, we have long campaigned for government to tax all wine in a manner related to abv.
A written submission calling for such a change was put to the Commons Health Committee on Alcohol last year but with no consequent action by the previous government. We will be writing to the new Chancellor urging him to correct the existing policy.
This would be a real beginning to the vital process of making consumers truly interested in, and conscious of, the alcohol they are consuming in their chosen wine.
Anthony Dann, chairman, Sovio Wines