Taxation revenues from wine are in line to rise by more than half over the next six years, according to estimates published by the Office of Budget Responsibility (OBR).
The OBR's projection of future government revenue reveals that the tax take from wine duties will rise from £3.1bn in 2010-11 to £4.9bn in 2016-17. "The OBR forecasts indicate a clear attack by the government on wine drinkers," said Angela Beech of chartered accountants Blick Rothenberg.
"This is an increase of 58% over the next six years. The biggest increase seems to be happening in 2016 with a 10% increase in one year alone. In comparison, the duty on spirits, beer and cider will have a moderate increase over the same period. Historically the government has always gone for spirits beer and cider, and now the last bastion, wine, is set to fall."
An OBR spokesman said: "All the figures in the OBR's forecasts are based on current government policy, with no assumptions about changes that have not already been announced."
Wine duties are slated to rise by 2% above inflation until 2014-15. The OBR projection for tax raised takes this into account and is also based on an 18% increase in wine consumption over the next six years, and a 17% decrease in the volume of beer sold.
The fiscal estimates from the OBR also suggest a big hike in the revenue the government expects to take from people who fill in self-assessment tax forms. It predicts that revenue from income tax will increase from £153bn to £208bn – a rise of 36% over the next six years, but a 43% jump in revenue from self-assessment.
But tax on companies will fall as a proportion of total taxation. The OBR estimates that companies will pay £48.6bn in tax by 2016-17, an increase of just 13%, with virtually no increase over the next three years.
The OBR expects the tax haul for fuel duties will be flat over the next few years, but appears to be anticipating a rebound in property transactions that will sharply increase the amount the government takes in stamp duty. It is pencilling in a near-doubling in stamp duty from £6bn to £11.4bn by 2016-17.
The estimates assume the TV licence fee will increase only very slightly over the next six years. The tax will bring in £3.1bn this year, rising to just £3.2bn by 2016.
Environmental levies will see the biggest percentage increase in revenue, according to the OBR. It anticipates they will rise from £0.5bn this year to £3.6bn by 2016.
Comments
29 November 2011 4:44PM
Not just a hit on wine drinkers but British vineyards, not a major employer of course but making a contribution to local economies in many ways. It's also likely to change the economics of taking the car to France for the day and filling the boot.
29 November 2011 4:46PM
I am coming up to 65 and am dusting off the DIY wine kit.
Remember the last recession when it was a big thing. Even Boots stocked all the kit. Wonder how long before they start again.
A home brew business has set up locally and I reckon he is onto a winner, at least for the time being.
29 November 2011 5:05PM
Next to the terminally ill getting their benefits cut if they actually do manage to live longer than 12 months, I don't think this really matters, do you?
29 November 2011 5:27PM
This will probably be the entire extent of the contribution to be made by the assumed elite little self-enrichment cadre so approved of by the Bullingdon Brigade whom run our country.
The 1% will feel so badly done to , exploited , and abused that they have to pay a smidge more for their plonk whilst the old freeze, the weak and disabled starve, and the infirm cannot afford to be cared for.
29 November 2011 8:51PM
It's already started hasn't it? My area of expertise is foreign reds under £4, and they're a dying breed.
Two years ago you could find a few drinkable reds in the £3.30 area, even some French AC's.
There were even some Chilean wines at £2.30-They're now £4, Sainsbury's put most of their cheap reds up another 40p recently.
Now there's very few of them left for under £4.
29 November 2011 9:13PM
siltec
29 November 2011 4:46PM
I am coming up to 65 and am dusting off the DIY wine kit. Remember the last recession when it was a big thing. Even Boots stocked all the kit. Wonder how long before they start again.
My last homebrew was Chateax '91 . I've still got the hangover....
29 November 2011 9:56PM
does this include thunderbird and mad dog 20-20?
30 November 2011 4:22AM
Again the Government are incredibly out of touch with their reasoning. Beer tax rise was because 'people drink strong lagers' yet it actually hit the Craft beer market more which isn't responsible for the NHS burden. Now they've turned an attack on wine; presumably because someone looked at a spreadsheet and realised they were more likely to generate income from that (very slow and poor analysis by Government again) however the real problem is cheap spirits.
Time and time again you hear about struggling alcoholics drinking cheap spirits which are incredibly accessible unlike craft beer. These spirits are often 40% proof abv and only around £5 per bottle yet they receive a tax freeze. The hypocrisy is staggering. Hopefully the only good will come is more home-brewing and more understanding of what goes into beer and wine. Maybe a few micro breweries and vineyards can be installed with this knowledge.
Please address the real NHS problems by talking to NHS staff and evaluating the problem properly. I'm fed up with paying over the odds for good quality beverages.
30 November 2011 8:34AM
Good to see that a policy of fact checking lives on in the comment section. The duty and the VAT on the duty for a 70cl bottle of 40% vol. spirits comes in at £8.57. And this doesn't include the cost of the bottle, the booze inside, transport or any profit anywhere along the line.
Unless there are shops selling vodka at a loss to attract the alcoholic section of the market (which isn't the taxation systems fault) I have to suggest you're imagining a problem where one doesn't exist.
30 November 2011 9:44AM
Ironically, it was the high price of drink in Britain which caused me to drink too much.
Every time I drove back through Calais I got swept along with the crowd stocking up on cheap alcohol. Its a powerful incentive to buy when you know its your last chance to get it before you get to England and its double the price.
So I bought too much, then felt I had better drink it.....
30 November 2011 2:57PM
Buy abroad and bring it back in the back of the car.