Wine sales slump as tax hikes bite

13 December, 2011

Wine sales dropped 3% in the past year and the pace of decline has accelerated this autumn as tax hikes bite, the WSTA has reported.

Off-trade wine volumes slumped 3% in the year to November 26 and 4% over the past quarter, according to Nielsen figures in the body’s latest market report.

Value sales grew 3% over the year – but that is down to duty and VAT hikes, the WSTA said.

Other categories performed well in the off-trade – cider grew 3% by volume and 11% by value, sparkling wine grew 2% by volume and 7% by value, gin grew 3% by volume and 9% by value and vodka grew 3% by volume and 10% by value.

In the on-trade, wine sales fell 6% by volume but value grew 9%, according to CGA Strategy figures in the same report. Sparkling wines saw volumes grow 2% and value 8%.

WSTA chief executive Jeremy Beadles said: “All the signs point to consumers cutting back on spending, and any growth in value is largely down to the impact of this year’s tax increases.

“While some categories, including sparkling wine, are bucking the trend, the prospect of a further above-inflation tax increase in March, amid gloomy economic forecasts, offers little joy for consumers or the trade.”

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