Categorized | Announcements, News, Wines

Companies Slam British Tax on Wine

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CONSTELLATION Brands and Foster’s Group, which own brands such as Hardys, Lindemans and Penfolds, have accused the British government of ”decimating” the country’s wine trade with constant tax rises.

Both companies, which employ thousands of Britons, have cut jobs and started to transfer investment to other European countries.

”The government has pushed this way too far,” said Troy Christensen, president of the European and Australian arms of Constellation, the world’s biggest wine producer. ”Doing what they are doing may be expedient but it is decimating our industry. We are on our knees. We are not asking for a bailout, just a break.”

Research for The Sunday Telegraph shows that while the price of a bottle of wine has risen by 25 per cent since Labour came to power in 1997, the duty on it has risen by more than 53 per cent.

The revelation comes as a survey by BDO accountants shows many businesses feel the tax regime is discouraging expansion and inward investment. The survey of 250 finance directors shows 70 per cent thought Labour’s tax policies deterred businesses from staying in the UK because of the level of tax and complexity of tax rules.

Stephen Herring, a senior tax partner at BDO, said US-owned Constellation would never have invested £70 million ($A115 million) in a British production plant had it known of the tax burden.

Peter Jackson, managing director of Foster’s Europe, said 55 per cent of the price of a £4.32 bottle of wine (the British average) goes on taxes: £1.60 on excise duty; VAT 65 pence; and 11p customs tariff.

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Sunday, December 17, 4:27 am

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