The recent increase in alcohol duty in the UK is expected to further elevate the prices of wine, as trade representatives have highlighted the financial implications of this decision made in the government’s latest Budget. With retail price inflation set at 3.66%, a bottle of Merlot priced at £8.50 may rise to £8.63 starting February 1, 2026. Industry leader Miles Beale, from the Wine & Spirit Trade Association (WSTA), criticized the new duty increase as a shortsighted move that exacerbates economic difficulties.
A recent report indicated that the UK ranks as the seventh most expensive European country for wine, with an average mid-range bottle costing £8. This ranking stemmed from the Pour Index, which found Iceland to be the most expensive, with bottle prices averaging £18.41, while Spain and Portugal ranked as cheaper options at approximately £4.36 and £4.35, respectively.
The duty taxes on wine vary drastically across Europe. Countries like Spain and Italy enjoy a zero rate on wine, maintaining lower prices compared to others like the UK, which has implemented a new system that ties duty rates to alcohol content. A recent analysis from the World Health Organization (WHO) pointed out that the UK, alongside Turkey and Nordic countries, maintains higher wine duty rates.
Despite previous increases, wine generally remains the least expensive alcoholic beverage in Europe. However, many countries have observed rising prices over the past decade. For instance, in Turkey, prices climbed by more than 1,500% in the last ten years, whereas other nations like Spain saw a 27.4% increase.
Comparatively, major cities such as London and Paris rank high for their fine wine offerings, with London generally showing higher average prices than Paris. According to a report from Knight Frank, the median bottle price at top restaurants in London surpassed US$740, whereas in Paris it was $551.
In summary, with the UK’s rising duty taxes, the price of wine is set to climb, potentially solidifying its status as one of the more expensive nations for wine in Europe. The fluctuation in prices is influenced by a variety of factors including production costs, taxation policies, and market strategies.