UK's sky high drinks tax helping Italy win fizz war

By Mathew Lyons

Published: 12 February, 2016

With England due to take on Italy in the Six Nations Rugby tournament on Sunday, the Wine & Spirits Trade Association is using the occasion to highlight the disparity in tax rates between the two nation's drinkers.

If UK consumers paid the same level of tax on their alcohol as the Italians do, it would save them some £287 a year.

As part of its campaign for a 2% cut in the rates of duty on wine and spirits, the WSTA points out that saving would be enough to pay for a romantic day-trip for two to Venice - including flights, a ride in a Gondola, lunch with a bottle of Prosecco and possibly even a Cornetto in St Mark's.

The Italians do not pay any duty on their wine, the WSTA reports.

Global consumption of sparkling wine grew 11.5% overall, while Italian sparkling wines exploded 52.1%.

That is in part due to the Italian government's support of its wine industry through a low-tax regime. the WSTA contends.

Miles Beale, chief executive of the WSTA, said: "I will be cheering England on this weekend and hopefully toasting their victory with a glass of English sparkling wine.

"But knowing that the UK has the second highest duty rate and that sparkling wine gets the worst deal of all in the EU is hard to swallow.

"Prosecco is leading the UK market in sparkling wine sales, but is this any wonder with such strong domestic support for Italian wine makers from their government?

"Giving wine and spirits a 2% cut makes sense."

The chancellor's decision to cut the duty on spirits by 2% and freeze the duty on wine in the 2015 Budget brought an extra £210 million in revenue to the Treasury in the nine months to the end of the year.

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