Yesterday Chancellor Rishi Sunak took to his feet in parliament and raised the living wage, recommitted to spending 0.7% of GDP on foreign aid and pledged more money for the NHS in his budget for there next year. But mainly, as far as the papers are concerned, he lowered the tax on Champagne. And, because we’re basic AF that’s our simplistic takeaway too.
At a time when gas prices are running riot, inflation and the cost of living are soaring and the NHS is at breaking point, it turns out that the discrepancy between how Champagne and sparkling wines are taxed compared to other wines is what really needs fixing. And, to be fair, the chancellor is perfectly capable of walking and chewing gum, so let’s cut him some slack and pop a cork or two.
The new system will untangle Britain’s complicated alcohol taxation regime, overhauling the UK’s 380 year old system of alcohol duty which Sunak derided as “outdated, complex and full of historical anomalies”.
In its place a far simpler system will now ratchet up tax as alcohol content ramps up. Which, when you think of it, sort of makes sense.
The new system will untangle Britain's complicated alcohol taxation regime...
The plan, which starts in 2023, will cost the Treasury half a billion pounds by 2027 will make a number of drinks cheaper (notably beer and Champagne) while drinks with alcohol content above 11%, like high-strength ciders and fortified like port, will attract higher taxation.
Andrew Carter, the CEO of English sparkling wine maker Chapel Down, said: “The duty saved will enable the industry to create jobs, support families, and bring even more young talent into this exciting, developing sector as it recovers from the pandemic.
A £7 bottle of Prosecco will be 87p cheaper...
“The English wine industry – comprising of 3,800 acres under vine, 800 vineyards, 178 wineries – is expanding rapidly and governmental support provides the opportunity to build English wine on a global level.”
The effect will be to make Champagne and sparkling wine cheaper (a £7 bottle of Prosecco will be 87p cheaper) while a pint of Guinness will be all of 3p cheaper.