The UK government confirmed on Wednesday, November 26, that excise duty on alcohol will rise in line with inflation. This measure is part of the newly presented national budget and will come into effect on February 1, 2026.
With the Retail Price Index (RPI) currently at 3.66%, the change will increase duty by 13 pence, meaning that a bottle of Merlot with 13.5% ABV could rise to GBP 8.63 (≈ EUR 10.02) if the full adjustment—plus VAT—is passed on to consumers.
The Wine & Spirit Trade Association (WSTA), led by CEO Miles Beale, has criticised the decision as ill-advised, warning that it will worsen the sector’s already fragile economic environment. According to the WSTA, wine and spirits will have become nearly GBP 1.00 (≈ EUR 1.16) more expensive per bottle within one year, factoring in cumulative duty increases, the new packaging levy, and VAT.
This will further reinforce the UK’s status as one of the most expensive countries in Europe for wine.
UK Among Europe’s Highest-Priced Wine Markets
A recent study by Into The Vineyard (The Pour Index), using Numbeo data, places the UK 7th in Europe in terms of wine prices, with an average of GBP 8.00 (≈ EUR 9.28) for a mid-range bottle.
Highest average prices in Europe:
- Iceland: GBP 18.41 (≈ EUR 21.34)
- Norway: GBP 12.70 (≈ EUR 14.72)
- Switzerland: GBP 11.21 (≈ EUR 13.00)
- Finland: GBP 10.89 (≈ EUR 12.63)
- Ireland: GBP 10.46 (≈ EUR 12.13)
Most affordable markets:
- Spain: GBP 4.36 (≈ EUR 5.05)
- Portugal: GBP 4.35 (≈ EUR 5.05)
France sits mid-table at GBP 6.10 (≈ EUR 7.08).
Why Prices Differ: Taxation, Production Costs, and Market Conditions
Wine prices vary due to numerous factors: production volumes, winery reputation, distribution costs, and availability. Additionally, exchange rates, tariffs, and excise taxes play a vital role.
Excise duty varies widely:
- Spain & Italy: 0% duty on wine
- France: Low duty
- Nordic countries, Ireland, UK: Among Europe’s highest duty rates
In the UK, the new system introduced in early 2024 taxes wine based on alcohol content: higher ABV = higher tax.
The World Health Organization (WHO) notes that wine remains the cheapest alcoholic beverage category in Europe, but recommends increasing taxes across all alcoholic drinks to reduce alcohol-related harm.
Long-Term Trends: Wine Prices Rising Across Europe
The American Association of Wine Economists (AAWE) reports that wine prices have increased in nearly all European countries over the past decade:
- Turkey: +1,500%
- Croatia: +92%
- Spain: +27.4%
- Italy: +7.4%
- Ireland: –11%
Although the UK is not in the AAWE list, government data indicate that an average 175 ml glass of wine rose from GBP 3.44 (≈ EUR 4.00) ten years ago to GBP 5.17 (≈ EUR 6.00) today.
On-Premise Consumption: London Among the Most Expensive Cities
In restaurants—especially those offering rare or premium wines—London ranks among Europe’s costliest cities. According to Knight Frank and Wine Services, the average price per bottle in top London restaurants exceeds USD 740.
Paris, by comparison, averages USD 551.
Conclusion
The confirmed excise increase illustrates how fiscal policy directly shapes wine affordability in the UK. With a new rise planned for early 2026 and strong inflationary trends, consumers and the wine trade alike face a more challenging market. The UK’s position as one of Europe’s most expensive wine markets appears set to strengthen even further.
Source: Vinetur