Taxes on beverages, from beer to fine wines, will be calculated according to their alcohol content. Industrialists are looking for a parade.
End of the day on the other side of the Channel. Head to Waitrose, a stone’s throw from the metro – the kind of supermarket where you hold back a tear at the checkout. The mission: to find a bottle for the departure of a colleague. In front of the wine department, we hesitate: no Americans or Australians this time, beware of sulphites. A vinho verde for a change? How much is 8 pounds already in euros? Is there any cheaper?
To make the right choice (and not lose an arm in it), perhaps we should look at the degree of alcohol rather than the grape variety or the appellation. Indeed, since August 1, a new system of taxation of alcoholic beverages, intended to bail out the coffers of the State, is in force in the United Kingdom. Excise duties – an indirect tax on consumption – will now be calculated according to the percentage of alcohol. A bottle indicating between 11.5 and 14.5% should for example undergo an increase in these rights of nearly 50 cents. Aperitif time could be turned upside down.
Good pick, on the other hand, for low-alcohol beers and ciders. A rant from wine and spirits producers, such as the powerful Scotch Whiskey Association, which evokes a historic blow to the industry. Manufacturers see this as a significant shortfall, citing the heavy price to be paid for inflation and an increase in future administrative costs – due to the management of these new excise duties. The tabloids are hoarse, like the Daily Mail, which keeps announcing price increases in the alcohol department. The portmanteau “drinkflation” – a combination of “drink” (drink) and “inflation” – even crosses the English Channel in the opposite direction and appears for the first time on BFM TV and Konbini.
“It’s for your good”
For the behemoths of the wine sector, the challenge is to continue to flood supermarkets with skittles between 5 and 8 pounds, considered the famous “fair price”. Even if it means using technological stratagems to reduce the alcohol content of their products, such as vacuum distillation which will influence the composition of the wine. While many companies have sniffed out the vein, some techniques have their share of drawbacks: expensive processes, consuming a large amount of water or even the final product with stunted, unbalanced aromas. Within the European Union, the method remains highly regulated. Prohibition to go beyond 20% of the degree of alcohol (except specific derogation), i.e. approximately 2% for a bottle of classic wine. French, Spanish or Italian productions will have to find another parade to survive on the British market. At the same time, do we really want to live in a world where we drink light Pic Saint-Loup?
Belight, the new range from Latin American Casillero del Diablo, already released a Sauvignon Blanc at the beginning of the summer at only 8.5 degrees, low in calories (65 for a glass against 120 on average), with the promise of intact aromas. Ditto at Australian Vintage, where it is announced that it will drop from 12.5 to 11% for a bottle of Black Label Chardonnay.
The phenomenon also affects the hops sector. Carlsberg, Foster’s, Shepherd Neame: all have announced that they will lighten some of their products. Their line of communication: “It’s for your good.” In fact, this type of taxation – the more alcohol there is in a product, then it is taxed – is presented by the World Health Organization (WHO) as an effective policy to combat alcoholism (report Alcohol pricing in the WHO European Region, 2020).
Could this be the time to invest in the non-alcoholic market? The trend is up sharply. The French from Moderato, self-proclaimed pioneers of “low-no” wine, for example, have just appeared on British shelves. The return of the races promises to be folkloric. “Honey, you bought some dealcohol again!”