Wine-lovers left to drown sorrows as tax hike hits cost of a bottle - but it's not all bad news for drinkers

Consumers will see the price of alcohol rise from Saturday when a hike in tax and duties comes into effect.

The alcohol tax itself will rise in line with the Retail Price Index at 3.6%, but a new system to tax wines and spirits based on strength will be introduced at the same time.

This means the duty on a bottle of gin will rise by 32p, while wine at 14.5% ABV (alcohol by volume) will increase by 54p.

The changes to excise duty and taxing wine according to strength came into effect on 1 August, 2023 but the Conservative government introduced a temporary reprieve for wines with a strength between 11.5% and 14.5%, taxed at a flat rate of 12.5%.

The Wine and Spirit Trade Association (WSTA) has calculated that a 14.5% ABV bottle of red wine would have risen by 98p in 18 months, taking into account new duty hikes introduced in August 2023.

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It also warned of further costs in April due to waste packaging recycling fees coming into effect, adding an additional cost of 12p for a bottle of wine and 18p for a bottle of spirits.

WSTA chief executive Miles Beale said: "There are no winners under the UK's punishing alcohol tax regime.

"Higher duty rates mean people buy less which results in reduced income to the Exchequer, businesses are being squeezed and consumers have to pay more."

However, in some relief to drinkers, duty on draught products - or pints pulled in pubs - will be cut by 1.7%, meaning a penny off a pint in the pub.

Exchequer Secretary to the Treasury James Murray said: "Our pubs and brewers are an essential part the fabric of the UK and our brilliant high streets.

"Through draught relief, small producer relief, and expanding market access for smaller brewers, we will help boost sector growth and deliver our Plan for Change to put more money in working people's pockets."

Richard Naisby, chairman of the Society of Independent Brewers and Associates, said: "The government's increased investment in draught relief means that draught beer sold in our community pubs has a lower rate of alcohol duty than beer sold in supermarkets and should encourage more people to support their local.

"At the same time by going further on small producer relief, the government can help small breweries to compete and grow their businesses."