From Patrick Hilyer author of the award winning Sawday's French Vineyards
Q: Why is wine still so much more expensive in the UK compared to wine in France?
A: Bottled wine is expensive to transport and heavily taxed by the UK government – even more so after yesterday’s ‘misery’ budget which adds another 10p of excise duty to the cost of a bottle.
Q: How much tax do I pay on a bottle of wine bought in the UK?
A: For a wine selling at say £4.99 in the supermarket, £2.45 of the cost is gobbled up buy Customs and Excise and the Vatman. At £3.99 the tax accounts for nearly 58% of the shelf price!
Q: That’s just at the cheaper end – what about more expensive ‘Fine Wines’?
A: Duty is a fixed tax, at present about £1.70 per bottle. The more you up-spend, the lower the proportion of alcohol duty. But, for a bottle priced at £15.99, you’re still paying over £4 in duty and VAT – over a quarter of the bottle price.
Q: So, if I spend £4.99 I’m only getting £2.55-worth of wine?
A: No, not even as much as that! Transportation, storage, and intermediaries’ margins take a slice out of the retail price, typically marking-up the winemaker’s cost price by at least 20%. For a £4.99 bottle this amounts to about 50p, so your £4.99 claret in really only worth £2!
Q: I’m spending five quid and only getting two quid’s worth! Can’t I dodge the taxman and the middlemen by buying mail-order?
A: Well, you can call a friendly winemaker overseas and ask them to send you a couple of cases through the post. Typically the duty is rarely collected on small quantities of wine sent to a private, domestic address but the transportation costs will add £4 or £5 to the per bottle price. And unless you know the wine and the vintage well, you might be disappointed with what you receive – plus breakages and corked bottles are difficult to replace.
Q: OK, you’ve got me… I’m not rich but life’s too short to drink bad wine – what’s the solution?
A: Go to France! They built a tunnel remember! The vineyards of the Loire, Champagne and Northern Burgundy are all well within reach for a weekend trip so you can buy your delicious dessert wines, festive fizz, favourite Chablis and rare red Burgundies at the cellar door. And taste them before you part with your hard-earned cash!
Q: Sounds good, but the French have duty and VAT n’est ce pas (see I’m already in the mood…)?
A: Yes, there is a tax on French wine but it’s only a few centimes per bottle (indicated, for French sales, by the little ‘Marianne’ stamp on the top of the cork capsule). VAT (or TVA) in France is currently at 19.6% but this is payable on only the cellar door price and the much, much smaller wine tax. So, your £4.99 wine from Tesco should cost about £2.40, all taxes paid, if you buy it at source.
Q: Ooh La La! La Belle France beckons! But how much wine do I have to buy to justify the cost of the trip? A: You’ll be saving between £2.50 and £4.40 per bottle if you buy in the £4.99 to £14.99 range (in UK price terms), more if you go for Grands Crus Classés and expensive vintage Shampers (but you said you weren’t rich…) So, taking an average saving of, say, £3.50, six cases of wine could save you £250 – which should cover the cost of the ferry or Le Shuttle. Sharing a consignment among your friends and colleagues? Buying for a wedding party or anniversary? Twelve cases of wine should save you enough for a week’s rent in a vineyard gîte or pay for the travel, petrol and a night (or even two!) at one of the hundreds French wineries with hotel or B&B accommodation.
