The Wine and Spirit Trade Association (WSTA) has urged the chancellor of the exchequer to cut alcohol tax, warning that another increase would be a major blow to businesses already “on their knees”.

In a letter to the new chancellor of the exchequer, John Healey, the trade association said that previous attempts to raise revenue with duty hikes have resulted in the death of many struggling businesses.

Suggesting a knock-on impact on employment levels in the UK, the WSTA commented that last month the Office for National Statistics found that almost 1 million young people aged 16-24 were not in education, employment or training. It continued that raising alcohol taxes would aggravate this issue.

Instead, the group encouraged the Treasury to “be bold and try a different approach” and cut alcohol duty, in turn boosting British business and creating jobs across the nation.

The WSTA added that the current system of increasing alcohol tax is not working, with spirits volumes down by 15.3% since 2022/23, still wine volumes down by 8% and fortified wine volumes down by over 22%.

Miles Beale, CEO of the WSTA, said: “If the chancellor, John Healey, ploughs on with plans to increase duty by RPI at next month’s Budget, at an estimated 2.9%, consumers will be landed with further duty increases, adding 10p on a bottle of Prosecco, 11p on a bottle of red wine and 31p for a bottle of gin. 

“In its Budget submission sent to the chancellor this week the WSTA argues that cutting excise duty will help restore consumer confidence, increase sales and increase revenue to the exchequer, while helping bring down inflation and stimulating UK businesses.

“Given the pressure on the public purse, inflation and on household incomes it argues that it is in everyone’s interests – government, industry and consumers – to maximise revenue earned and minimise costs by cutting alcohol duties.”