As the Chancellor prepares to deliver his last pre-election Budget to the House of Commons today, the drinks industry waits nervously to find out if this year’s campaign has persuaded him to Drop the Duty!
Miles Beale, chief executive of the Wine and Spirit Trade Association said there was nothing left to do but wait Osborne’s speech. “All the decisions are made and the numbers fixed in - but it is worth considering the impact of further increases in duty,” he told Harpers.co.uk
“An inflationary increase of 2% would be an additional tax bill for wine consumers and businesses of around £70m on top of the £3.8bn they already pay each year. For spirits it would mean an additional £40m on the existing £3bn annual total. This is why the WSTA has been campaigning so hard on behalf of our members and the wider trade. We have our fingers crossed that our industry gets the break it deserves and the Chancellor makes wine and spirits taxation fairer!”
George Osbourne gave nothing away as he tweeted on Monday - and members of the industry refused to speculate.
“No giveaways or gimmicks, a budget for the long term where everything’s paid for. We have a plan that’s working & we should stay the course”
George Osborne @George_Osborne 15 March 2015
Earlier this month Tim Wilson of the Wilsons Drinks Report warned there was a “small risk” duty could rise by 2.1%. He told the March for Independents conference: “It is an election year and despite a fantastic campaign, if Osborne decides a cut in petrol is more important [to the electorate] than wine, there is a small risk that he will feel the need to do it.”
Following last year’s successful campaign which saw the hated duty escalator abandoned, duty on spirits and ordinary cider frozen and beer duty cut by 1p per pint, this year’s campaign has focused on galvanising support for a 2% cut in duty.
This would unlock over £3 billion in economic activity and bring in an extra £1.1 billion in tax, it argued. Around 60% of the cost of an average bottle of wine is currently taxes and duty, and the taxation rate is in danger of unfairly penalising our fledgling domestic wine-production, the campaign argued.
Senior trade figures rallied around the Drop the Duty campaign, which was coordinated by the Wine & Spirit Trade Association and the Scotch Whisky Association with support of the TaxPayers Alliance. It also received the full backing of the British Institute of Innkeeping and the Association of Licensed Multiple Retailers, major suppliers Enotria, Bibendum PLB and Hallgarten Druitt as well as a host of smaller artisan producers and independent merchants.
* You can follow our live Budget coverage today from 12.30pm on our website and on Twitter @harperswine using the #Budget2015 hashtag.