Post-Brexit and COVID-19 affected sales are hurting the UK’s spirit and wine industry, but help is not coming from the government which is not lowering the highest duty in all of Europe, according to the Wine and Spirit Trade Association (WSTA).

UK drinkers are currently forced to pay £2.23 on duty per bottle of still wine, £2.86 on a bottle of sparkling wine and £8.05 for every bottle of spirit at 40% ABV.

Duty is currently so high in the UK that 55 percent of the average priced bottle of wine and 73 percent of an average priced bottle of spirits sold in shops and supermarkets is now taken by the Treasury in tax and VAT.

Miles Beale, chief executive of WSTA, said: “The UK ‘s punishingly high duty rates are stifling home grown wine and spirit businesses as well as acting as a deterrent to attracting investment.

“A duty cut would provide the UK’s wine and spirit businesses the breathing space needed to recover from the COVID pandemic and the almost complete shutdown for the UK’s hospitality sector – the drinks’ industry’s shop window – allowing them time to plan for growth, including innovation and exploring new opportunities. And from experience we also know that duty cuts often lead to increased revenue for the Exchequer – from both VAT and duty receipts.

“The alternative is depressing. In the current climate duty hikes will undermine the viability of some businesses and reduce the ambition of others. In particular tax increases will suppress already falling demand, by raising prices to consumers, as well as reducing choice. Indeed, duty increases would send all the wrong signals to consumers and to UK drinks businesses, most of which are SMEs. It would be the perfect blend for exacerbating the adverse effects of COVID and undermining recovery and future growth.”

The UK’s wine and spirit industry is integral to our economy, supporting some 360,000 jobs in the UK, contributing £49 billion every year in economic activity and paying more than £12 billion in duty and VAT.