Duty Goes Up Again. Sales Keep Falling.
UK alcohol duty goes up again next February.
On October 28, John Healey delivered his first Budget as Chancellor. Alcohol duty will rise 4.55%, in line with the Retail Price Index, from February 1, 2027. Nothing new was added; the Budget simply confirmed the increase that was already planned.
According to Wine and Spirit Trade Association calculations reported in the press, that means about 18p more on a bottle of 14.5% red wine, about 14p on a bottle of Prosecco, and about 3p on a pint of beer. Those per-bottle figures come from secondary reports. WSTA chief executive Miles Beale called it a “breathtaking hike.”
Pubs, on the other hand, got something. Business rates for pubs and music venues will be cut by a further 20%, and the threshold for small business rate relief rises. Small Producer Relief gets an extra 10 million pounds a year. But that relief only covers drinks up to 8.5% ABV, so most wine is outside it.
Why again, and why now? The UK reformed its alcohol duty system on August 1, 2023, tying the tax on wine to its alcohol strength. Increases followed in February 2025 and February 2026. By the WSTA’s count, duty on a bottle of 14.5% wine has risen by 1.20 pounds over three and a half years, or 1.35 pounds including VAT.
Over the same period, sales have fallen. NielsenIQ off-trade data for the 52 weeks to the end of March 2026 show wine volumes down 8% and spirits down 15% against 2023. Spirits duty receipts fell by 154 million pounds year on year between April 2025 and January 2026. The WSTA’s argument was that higher duty was not filling the Treasury’s coffers, and it asked for a freeze or a cut.
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The Treasury, for its part, expects roughly 13 billion pounds in alcohol duty this year, on the assumption that consumption falls about 1% a year. That is a government raising the rate while pricing in a shrinking base. Perhaps the arithmetic holds. Perhaps at some point it does not.
In a country where tax is set by strength, the same wine costs more the higher its ABV. I find myself wondering whether the numbers on the labels will quietly start to drift.
Sources
The Spirits Business (October 28, 2026): https://www.thespiritsbusiness.com/2026/10/uk-budget-spirits-excluded-from-relief-as-duty-rises/
Brit Brief (October 28, 2026): https://britbrief.co.uk/business/economy/budget-2026-beer-up-3p-wine-18p-in-record-tax-hike.html
BeverageDaily (October 26, 2026): https://www.beveragedaily.com/Article/2026/10/26/wsta-urges-alcohol-duty-cut-as-wine-and-spirits-sales-fall/
This post was drafted with AI assistance and reviewed against the linked sources.
