Business: Taxation
The question
To ask the Chancellor of the Exchequer, what estimate she has made of the cost to businesses of administering the excise duty system following the end of the temporary easement on 1 February 2025.
Answered by James Murray
In August 2023 the Government introduced reforms to alcohol duty so that products are taxed in proportion to their alcoholic strength, not volume. The reforms aimed to modernise and simplify the system, to prioritise public health and incentivise consumption of lower strength products.
To help the wine industry adapt to the new duty system, the current, temporary duty easement was introduced as a transitional measure, which was intended to allow time for wine producers to adapt to calculating duty based on alcohol by volume.
By the planned end-date of 31 January 2025, the wine industry will have had over two years to adapt to the new strength-based system.
The Government publishes tax information and impact notes (TIINs) for tax policy changes. The summary of impacts from the changes to alcohol duty announced at Spring Budget 2023, including the wine easement, can be found here: Reform of Alcohol Duty Rates and Reliefs - GOV.UK
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