What the UK’s post-Brexit tariffs mean for the wine industry
The Government has published the UK’s new tariff regime which will replace the EU’s Common External Tariff on 1 January 2021.
The new UK Global Tariff (UKGT) will apply to all goods imported into the UK unless there is a tariff suspension in the company they are sent from, they come from developing nations, or a trade agreement has already been reached with the UK.
Under the current plans, wine from countries like Italy and France and Spain will become more expensive for UK consumers.
On the whole, the UKGT’s rates replicate the tariff system already in place thanks to the use of the common market. This means that all wine imports will be taxed at a rate of between £10 and £26 per hectolitre, depending on its place of origin.
For example, bottles of still white wines produced in Alsace, Bordeaux, Tuscany or Valencia will all have a rate of £10 per hl. Meanwhile, the tariff on Champagne is higher at £26 per hl.
However, the tariff rate on machinery such as presses, and crushers used in the manufacture of wine, cider, fruit juices or similar beverages will be reduced to 0%, compared to 1.7% in the common external tariff system.
Miles Beale, Chief Executive of the Wine and Spirit Trade Association, said the measures are “another blow to wine importers, independent wine merchants, pubs, and restaurants at a time when so many are already worried about their businesses and making finances go further.”
“It will not increase choice for consumers, but instead will add an unnecessary barrier to trade.
“This week the Chancellor warned the UK it faces a significant recession. Today there is more unwelcome news from Government, with the prospects of reaching a deal with the EU looking increasingly unlikely, the UK’s 33 million wine drinkers will be faced with price increases on about half the wine they enjoy.
“The shutdown of the hospitality sector has been hugely disruptive, and this news just adds to a long list of worries. Government needs to start listening to – and acting upon – suggestions from UK businesses, including taking action now to remove burden and costs on UK businesses and allow them to be more competitive to aid the UK’s economic recovery.”