
On 1 February 2025, the tax on most wine will change from being a single rate to being based on how much alcohol the wine contains. Other alcohols have been taxed according to alcoholic strength since August 2023, but most wines were temporarily taxed differently. The imminent end of the single tax rate is causing concern among wine industry professionals.
This Insight covers how alcohol taxation works, the current arrangements for the wine industry and the debate about the upcoming change.
What is happening on 1 February?
From 1 February 2025, alcohol tax (known as ‘alcohol duty’) on all wines will start being calculated according to alcoholic strength. Duty on other alcoholic products is already calculated according to alcoholic strength.
Rates of alcohol duty are also increasing on 1 February, in line with inflation. The table below shows the alcohol duty rates in place from that day.
Alcohol duty rates from 1 February 2025
Duty rate per litre of pure alcohol
Alcoholic strength (abv) | Beer | Still cider | Sparkling cider | Wine, spirits, and other fermented products |
---|---|---|---|---|
1.3% – 3.4% | £9.61 | £9.61 | £9.61 | £9.61 |
3.5% – 5.5% | £21.78 | £10.02 | £10.02 | £25.67 |
5.6% – 8.4% | £21.78 | £10.02 | £25.67 | £25.67 |
8.5% – 22% | £29.54 | £29.54 | £29.54 | £29.54 |
Over 22% | £32.79 | £32.79 | £32.79 | £32.79 |
How does alcohol duty work?
Alcohol duty is a tax on alcoholic drinks of different kinds. It is charged according to alcoholic strength, known as ‘alcohol by volume’ (‘abv’). This is the percentage of pure alcohol in a product, as shown on a product’s label.
Usually, the higher the abv, the higher the duty. This system of taxing alcohol was introduced in August 2023 by the Conservative government, with the aim of simplifying administration and improving public health (by discouraging the provision of high-strength, cheap drinks).
For more information, see the Library briefing the new alcohol duty system.
How is alcohol duty calculated?
The following example calculates alcohol duty on a 1 litre bottle of 11% abv wine. 11% abv means that 0.11 litres (11% of 1 litre) of this bottle is pure alcohol.
11% abv is in the 8.5% to 22% abv duty band (see the table above), which from 1 February will be charged £29.54 per litre of pure alcohol.
The duty owed on the 11% abv bottle of wine is calculated by multiplying the litres of pure alcohol in the bottle by the amount of duty per litre of pure alcohol:
0.11 (litres of pure alcohol) x £29.54 (duty per litre of pure alcohol) = £3.24
How has wine been taxed since August 2023?
Since 1 August 2023, wines with an abv between 11.5% and 14.5% have been temporarily taxed as if their abv was 12.5%. Wines in this band are therefore subject to a single duty rate regardless of their strength. The Wine and Spirit Trade Association (WSTA), the main industry body, has said the 11.5% to 14.5% abv band covers over 80% of wines in the UK market (PDF).
This temporary single duty rate (the ‘easement’) was implemented at the same time as the new alcohol duty system was introduced for other alcoholic products (see above). The government implemented the easement to support the wine industry’s transition to taxing wine according to strength. Before August 2023, wine duty was predominantly charged according to volume, rather than how much alcohol the product contained.
For more information about how wine duty operated prior to August 2023, see section 4.2 of the Library briefing on the new alcohol duty system.
The easement will end on 1 February. From this point onwards, wine duty will be calculated according to a wine’s alcoholic strength (as labelled). The chart below shows how wines in the 11.5% to 14.5% abv band will be taxed under the new alcohol duty system compared with how they have been taxed under the easement system.

Gov.uk provides information on how all other alcoholic products are taxed. Wines with an abv below 11.5% or above 14.5% are already taxed according to strength, as they fall outside the band covered by the easement.
Who has called for the easement to be made permanent?
The WSTA has called for the easement to be made permanent (PDF). It has argued that “the abv of a wine cannot be pre-determined, dictated or maintained at the same level year after year. The same wine from the same vineyard can vary by c.2% each [year]”.
Producers said it is difficult for winemakers to control alcoholic strength. They argued that ending the easement would increase administrative costs, bureaucracy, and prices for consumers, because producers would have to regularly check and account for their wines’ abv. Additionally, since the UK allows wine producers to label their products in 0.1% abv increments, the WSTA argued that the industry could face up to 30 duty rates (PDF – one for each 0.1% increase between 11.5% and 14.5% abv) rather than one. They argued this would represent a significant administrative burden.
Several MPs have also called for the wine duty easement to be made permanent, including in parliamentary questions and during a March 2024 Westminster Hall debate.
Is there support for ending the easement?
Yes. The Institute of Alcohol Studies (IAS), an organisation researching alcohol harm, supports the ending of the easement. They argued that making the easement permanent would go against the public health objectives of the reform to the duty system, and the principle that higher strength drinks should be taxed more heavily.
The IAS added that “winemakers have been [reducing the strength of their wines] for many years now, due to changing drinking habits”, for example by picking grapes earlier.
The IAS agreed that the new system would increase the administrative burden for the wine industry. However, in relation to concerns raised about 30 duty rates being potentially applicable after the ending of the easement, the IAS added that winemakers are only required to label their products at 0.5% abv intervals, rather than 0.1%.
What is the government’s position?
At Autumn Budget 2024, the government confirmed that the wine duty easement would end on 1 February 2025.
In November 2024, answering a parliamentary question, Exchequer Secretary to the Treasury, James Murray, said that the reforms to alcohol duty had been implemented to simplify administration, support public health objectives, and “incentivise consumption of lower strength products.” He added that by February 2025 “the wine industry will have had over two years to adapt to the new strength-based system.”
Mr Murray also said that HMRC will evaluate the impact of the new alcohol duty system in August 2026, three years after its implementation.
About the author: Francesco Masala is a Commons Library researcher.
Photo by: Hermes Rivera on Unsplash