The Wine & Spirit Trade Association has joined calls for the Chancellor to cut alcohol duty at the upcoming autumn budget, warning a further increase would be “a major blow to businesses and consumers…already on their knees”.
The trade body has written to John Healey to highlight the negative impact of previous duty rises on struggling drinks and hospitality businesses. It is calling for the Treasury to “be bold and try a different approach” and cut alcohol duty to help boost British businesses, create jobs across the UK, give consumers a reprieve and bolster Treasury funds.
“Businesses are on their knees thanks to years of painful alcohol tax hikes,” WSTA boss Miles Beale said. “Add to that the other government imposed costs including business rates, escalating employment outlays, EPR and DRS packing taxes – the current outlook is dire for the alcohol industry.”
When a new excise duty regime was introduced in 2023, spirit duty increased by over 10% and the duty on the vast majority of still wine sold in the UK increased by at least 20%, the WSTA said.
Since then, British consumers had been forced to “swallow two further duty hikes and seen further price rises with the introduction of wine being taxed according to its strength”, it added.
Instead of swelling Treasury coffers, the tax rises have resulted in a fall in the value of total alcohol duty receipts, which declined by £182m, or 1.4%, to £12.4bn in the financial year ended 6 April 2026.
The rising cost of alcohol had “caused a dip in sales as consumers can no longer afford to treat themselves”, the WSTA said, pointing out spirit and still wine volumes had declined by 15.3% and 8% respectively in the past three years.
“History has shown that putting up taxes on alcohol is a flawed revenue raising tactic and instead is a death nail for many businesses up and down the country, particularly SMEs,” said Beale. “Consumers cannot afford to keep up with the price increases, which are delivering for no one.
“We can only hope that the new PM and his Treasury are willing to listen to sound business arguments, be bold and try a different approach and cut alcohol duty at the budget.
“And, in a way, it’s simple: cut duty and grown revenue to repair the public finances.”
It comes after the Society of Independent Brewers & Associates called on the Chancellor to “drop the tap tax” by expanding the duty relief offered on draught beer.
Increasing draught duty relief to 50% would help create over 7,600 extra jobs in the pub and beer sector and add more than £300m to the economy, SIBA claimed, citing new research by the Centre for Economic & Business Research.
A Treasury spokesperson said: “The Chancellor is fully focused on his priorities, to boost business, help with the cost of living and support people in every postcode. As has always been the case, the Chancellor will set out decisions at fiscal events, rather than routinely commenting on rumour, speculation or proposals.”
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