Port and sherry importers ‘aghast’ as tax shake-up will add over £1 to bottle price | Food & drink industry

Britons partial to a festive glass of port or sherry should nurse it carefully this Christmas as a shake-up of alcohol taxes threatens to add at least £1 to bottle prices next year.

The chancellor announced a sweeping overhaul of alcohol duties in the budget, reducing the tax take on lower-strength drinks, such as draught beer, but increasing them on products, such as fortified wine, with an alcohol content above 11%.

Andrew Hawes, the managing director of the wine importer Mentzendorff, said port and sherry fans were about to be hit with the “largest single alcohol tax rise in UK history”. UK shoppers buy 10m bottles of sherry and close to 9m bottles of port each year.

“Local wine merchants up and down the country are aghast at the suggested tax rises, which will see port and sherry brands such as Taylor’s and La Gitana take on the largest single alcohol tax rises in UK history,” said Hawes.

“Ultimately I fear it will be the consumers who will pay the price, which is a shame especially as we’ve invested so much to attract a new following to the joys of these fortified wines, which to date have offered incredible value.”

Steve Moody, the managing director of Fells, another importer, said it made “absolutely no sense” to target the fortified wine category as sherry and port were “enjoyed in moderation” by friends and families on special occasions.

“If the proposals remain unchanged it will result in the retail price of a bottle of port increasing overnight by £1.09,” he said. “That’s an immediate increase of more than 13%.”

The Wine and Spirit Trade Association (WSTA) is concerned the higher prices will kill off the sales revival being enjoyed by fortified wine makers, who have won a new, younger after thanks to the emergence of Fino bars. Sherry has also become a popular ingredient in homemade lockdown cocktails with UK sales up 13% in 2020.

Whilse some alcoholic beverages can be adapted to bring down their alcohol content or ABV, there are strict production rules for port and sherry that do not allow producers to tamper with strength. The WSTA is calling for the government to rethink the plan which is the subject of a consultation that runs until the end of January.

Miles Beale, the WSTA’s chief executive, said that if you enjoyed a port or sherry at Christmas “make the most of it this year as it might be priced out of your Christmas shop in the future”. The government needed to make sure it wasn’t introducing a new system that “embeds unfairness between products”, he added.