From Saturday, the cost of wine and spirits will climb as the government raises alcohol duty in line with inflation and implements new rules linking tax levels to the strength (ABV) of each drink.
While trade bodies warn that this will be a “bitter blow” for the sector, the duty on draught pints is set to fall by a modest 1.7 per cent—resulting in roughly 1p off an average-strength pint.
Under the revised system, taxes on some stronger drinks will go up even more. A temporary reprieve for certain wines ended last week, meaning duty on a 14.5% ABV bottle of red wine has risen by 54p, according to the Wine and Spirit Trade Association (WSTA). The WSTA argues that such increases risk undermining government revenue goals, as higher prices could prompt consumers to buy less, while at the same time squeezing drinks producers.
However, a Treasury spokeswoman defended the policy, highlighting the government’s drive to “modernise and simplify” the duty system in a way that supports lower-strength drinks. The Treasury has also expanded small producer relief for beverages below 8.5% ABV, aiming to help smaller-scale brewers and craft producers.
Although pubs welcome the minor tax break on draught drinks, they still face a wave of cost pressures. This April, increased National Insurance contributions for employers and the higher minimum wage could force pubs to raise pint prices by as much as 30p to 40p. Tim Martin, chief executive of JD Wetherspoon, estimates that staff cost rises will amount to £80 million a year for the chain.
The British Beer and Pub Association is urging the government to maintain support for the sector, warning of an “April cliff edge”. Yet some union representatives maintain that large pub companies should absorb some cost increases rather than passing them on to customers.
For consumers, the cost of many alcoholic beverages—especially wine and spirits—will inch upward just as living costs remain high. Meanwhile, small brewers and producers offering lower-strength pints stand to benefit from the changes, potentially helping them to compete against supermarket deals on alcohol.