Today the Chairman Peter Gladwin, and the I, wrote to the Chancellor requesting that he considers a duty cut on wine, which would have a positive affect on the industry. The letter reminds him that raising duty on wine, as his predecessor did in 2016, has a negative impact on our industry, which is a key growth sector of the agricultural economy. It also points out that the UKVA is keen to work with the Chancellor and his team as we begin our internal consultation and discussions about a fair and appropriate duty scheme that would work for our fast growing industry and recognising its special status.
The recent UKVA bulletin pointed out that there is a committee being formed and there will be more to come on this in due course.
In the meantime the text of letter is below and can also be downloaded as a PDF. It is worth sending to your local MPs!
Please contact me if you need the email address of your MP and a template covering email to go with the PDF.
27th February 2017
The United Kingdom Vineyards Association represents some 530 growers and producers of English and Welsh wines, large and small, and is Britain’s fastest growing agricultural industry. We are writing to ask you to fully consider the Governments actions on our industry when looking at duty on wine in the forthcoming budget.
By 2020 we expect that there will be 3,000 hectares under vines, up from about 2,000 presently planted. Indeed, it has been estimated that this year over 1 million vines will be planted in the U.K. This will see a doubling of production to 10 million bottles by 2020 with an export market having the potential to increase tenfold from 250,000 bottles to 2.5 million bottles in that time. This near exponential growth is expected to continue in the decade that follows.
At this moment, and for the first time in our 50 year history the UKVA is undertaking an industry wide consultation and research project that will seek to inform Government of our thoughts as to what would be the most beneficial duty system in terms of promoting growth, commercial sustainability and fair taxes for all scales of vineyards and wine producers.
One way forward might be a similar model of duty relief like the one implemented in 2002 for the independent brewing industry, but that takes into account the needs across various scales of vineyards. However, the structure of the UK wine industry is not the same as the UK beer industry so careful consideration of this issue is required. Indeed, post-BREXIT there may be a range of opportunities to really support our industry, make it more competitive and encourage exports in a positive way.
We would like to work with Government proactively in this endeavour to help benefit our industry in terms of promoting entrepreneurship and creating jobs, all of which will positively impact the treasury whilst supporting our homegrown industry. To that end we would like to ask to meet with you and discuss this matter later this year.
In the meantime we would ask that you and the Treasury carefully think about the impacts of any duty rises on wines you might be considering on our important and growing industry. You may recall that last year your predecessor increased duty on wine, as it turned out, perhaps inadvertently impacting on U.K. Producers, following as it did a key round-table discussion with the DEFRA minster.
Already the commercial sustainability of our smaller growers is threatened by duty and a further rise would have a significant impact. Indeed, we would urge you and the Treasury to look at lowering duty on wine this year ahead of a discussion with Treasury on how we develop a duty system that could be more supportive of our industry than the current system.