Wine Duty

Debate between Will Quince and Stephen McPartland

Tuesday 5th March 2024 Westminster Hall

[Will Quince (Colchester) (Con)]

I beg to move,

That this House has considered wine duty.

It is a pleasure to serve under your chairmanship, Mr Henderson. I am pleased to have secured this important debate the day before my right hon. Friend the Chancellor of the Exchequer delivers the Budget statement to the House. I am grateful to the Minister for responding. I know he will take very seriously the points I will make further to our correspondence on this issue. I would also like to thank the unusually great number of right hon. and hon. Members present for supporting this 30-minute Westminster Hall debate. I hope the Minister has noticed the strength of feeling on this important subject.

I applied for this debate as a result of meeting the chief executive officer of Majestic Wine, which is the UK’s largest specialist wine retailer, with more than 200 stores across the UK, including a large store in my constituency. They raised a number of concerns relating to wine duty that I felt were important for the House to hear and reflect on. The UK is a major global hub for wine and spirits. It is the world’s second largest importer of wine by volume and value, and the largest exporter of spirits. It supports over 390,000 jobs, £69 billion in economy activity and £8.6 billion in excise duty revenue.

Like all businesses, those across the wine supply chain have had to confront some tough trading conditions over recent years, but a number of the challenges they face are unique to the wine and spirit trade, and these were brought to my attention by Majestic. The challenges faced by Majestic and other similar businesses stem primarily from the new alcohol excise system, which was introduced last year. In particular I am referring to the impact of the historic duty increases and the changes to the way wine duty is calculated. The introduction of the new duty regime last August followed a review of the inherited EU duty rules. When the review was announced, it was welcomed across the drinks industry, which backed wholeheartedly the aims of the review, which were to make the new duty system fairer, simpler, less distortive and easier to administer.

Sadly, particularly for wine and spirit businesses, the new regime is not fairer. In fact, in many ways it has reinforced the existing market distortions. For wine businesses, the new system is anything but simpler to administer—in fact, it is exactly the opposite. The new system that was introduced on 1 August 2023 levies excise duty on all alcoholic products according to strength, but at different rates. This reinforces pre-existing market distortions by continuing to tax wine and spirits more harshly than other categories of alcoholic drink.

When introducing the new system, the Government recognised the impact it would have on wine businesses and rightly put in place a temporary easement mechanism that pegged the amount payable for wines in the range of 11.5% to 14.5% at the amount payable on a wine of 12.5% alcohol by volume. That amount is currently £2.67 per bottle. Wines falling within this easement mechanism account for 85% of the wine sold in the UK market. That is 1.1 million out of 1.3 million bottles sold. This easement is set to end on 1 February 2025.

[Stephen McPartland (Stevenage) (Con)]

I am grateful to my hon. Friend for securing this important debate. I represent the Wine Society, which is headquartered in Stevenage and is a large organisation struggling under this pressure. It will cost it £300,000 to £400,000 to upgrade its systems. It is being asked to price wine before the level of alcohol is known, as wine is an agricultural product, and it is having to re-evaluate the range of wines it is able to output, which is having a knock-on effect on the supply chain. Does my hon. Friend agree that this seems to be a difficult case of unintended consequences, and if the easement he refers to were to be made permanent rather than temporary, it could solve the problem?

[Will Quince]

I thank my right hon. Friend for his intervention. He is right to champion the cause of the Wine Society, which is based in his constituency. There is both a significant cost implication and an administrative burden for such organisations, so the impact of these changes should not be understated.

The easement that is set to end on 1 February 2025 will affect wine businesses ranging from major retailers such as the big supermarkets to specialist retailers such as Majestic. However, as my right hon. Friend has just alluded to, there are also thousands of independent wine merchants who have all said that having to implement fully the strength-based system would impose significant costs, running to many millions of pounds, both in the short term and once the necessary systems are established.

Universal Credit: Delayed Roll-Out

Debate between Will Quince and Stephen McPartland

Tuesday 4th February 2020 Commons Chamber

[Will Quince]

The hon. Lady says that I should be embarrassed. I will never be embarrassed about putting the most vulnerable and disadvantaged people in our society first, and neither will the Government. She talked about cost. As I have said, this is up to £500 million of additional money that will go into the pockets of our claimants. When she referred to the pilot, she was conflating two very separate issues. She also said that people were scared. Perhaps if members of the Labour party desisted from their scaremongering and spent more time in our jobcentres speaking to work coaches, they would have a better understanding of universal credit and how well it is working.

[Stephen McPartland (Stevenage) (Con)]

I am certainly no fan of the Department for Work and Pensions and its campaign to improve universal credit, but I do know that this Minister cares about making universal credit work, and this Minister has my full backing to make it work—and I have worked with many Ministers over the last 10 years. Will he tell me clearly, however, whether my constituents will be better off or worse off because of the way in which the migration works?

[Will Quince]

I thank my hon. Friend for his question and for his kind words. The answer is a categorical yes: his constituents will be better off. Under our forecasting, around 900,000 people will now be eligible for transitional protection, and as a result they will be better off.