The boss of Majestic Wine has slammed the new post-Brexit alcohol duty system, warning it will cost both businesses and shoppers more.
The price of some red wines could rise by over 40% next year after the government ignored calls from the wine industry to scrap complicated post-Brexit changes.
As a result, the number of tax bands for wine will rise from one to 30, with retailers saying it will now cost them more money to administer.
Majestic Wine CEO John Colley said: “The minister demonstrated in this debate a worrying lack of understanding of our sector, suggesting that the alcohol duty system has become simpler and easier since Brexit.
“That is simply not the case. In fact, the system in place pre-Brexit was much simpler to administer.”
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The news comes after the government brought in a post-Brexit overhaul of alcohol taxation last August, which taxes drinks on alcohol by volume (ABV) rather than the type of alcohol.
The overhaul means the amount of duty paid increased by 2p for every 0.1% rise in strength.
The government implemented an 18-month “easement” period due to the new administrative burden for companies, where all wines between 11.5% and 14.5% had to pay £2.67 tax, making it the 12.5% ABV duty rate.
Although the wine industry has called for the government to permanently maintain these easement rules, earlier this month exchequer secretary to the Treasury Gareth Davies announced the change would go ahead.
Analysis from the Wine and Spirits Trade Association showed prices on around 43% of wines would rise once the easement period ends.
Red wines will see the biggest rises due to their higher alcohol content, with prices on 75% of bottles forecast to increase from next February.
The Guardian reports that the changes will result in big administrative costs for businesses, as staff will need to calculate the tax due on each wine.
The chief executive of the Wine Society Steve Finlan told the title that the plans were “ludicrous, expensive and probably unworkable”.
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