The government’s reformed alcohol duty system has now come into force. The new regime brings the biggest increases in alcohol tax for five decades, with spirits, still wine and fortified wine among the hardest hit.

The revamp sees the established system of taxing alcoholic drinks by type replaced by one based on abv. It means that higher-strength products have seen big increases, while lower strength ones are less adversely affected. A few have even see decreases.

There is a small producer relief for those making less than 4,500hl of alcohol a year, and relief on draught beer in an attempt to help keep punters in the pubs. But for most brands and their consumers, the impact will be harsh.

Spirits at 37.5% abv see a duty hike of 76p for a bottle, a duty rate increase of around 10%. Still wine at 12.5% abv has gone up 44p a bottle from a 20% duty increase, and the Wine & Spirit Trade Association notes that wines from hotter climates which produce naturally higher abvs face the biggest increases.

The changes include a temporary arrangement in which wines between 11.5% and 14.5% abv are taxed at an assumed strength of 12.5% abv until 2025.

Port and sherry face a 44% duty increase, adding £1.30 to a bottle of port at 20% abv and 97p to sherry at 15%. Hallgarten & Novum Wines is offering the old rates of duty on 148 still wines for those ordering between five and 100 cases during August. The Wine Society said it would absorb increases until October.

Under the new regime, a 44cl can of 4.5% abv beer has gone up 4p and cider of the same strength increased 8p. The British Beer & Pub Association said that the increase on beer, although relatively modest on a per-pack basis, would cost the brewing industry £250 million a year.

Isolated categories to see a benefit are sparkling wine, where a 12% abv bottle dropped 19p in price, and RTDs, where 5% abv 25cl cans fell by 5p.

The new system introduces an escalating duty scale across alcohol categories, with the rate increasing at 3.5%, 5.6%, 8.5% and 22% abv, regardless of drink type. It means that producers such as brewers and cidermakers that can successfully reduce abvs to hit lower rates could benefit. Some, including Carlsberg, have already reformulated their products to take advantage of the scheme.

But WSTA chief executive Miles Beale pointed out that this was less practical for wine producers. “Making wine isn’t an industrial process,” he said. “Reducing wine’s alcoholic content is limited, changes the product and is costly to carry out.”

Wine trade reacts to duty hikes – Prowein analysis