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Luddenden Valley Wines fights for excise duty reduction

Published:  02 December, 2013

Luddenden Valley Wines has launched a campaign for excise duty on wine-production levels at small-scale UK producers to be brought in line with cider and beer distillers in a bid to help UK wine producers become more competitive.

Gwyn and Elaine Evans, who own the eight-acre estate in West Yorkshire which produces country wines made from elements such as elderflower and parsnip argue that, given high duty levels and packaging costs, Luddenden can't supply to retailers without losing its margins.

Luddenden Valley is looking for UK tax laws on wine production to match those covering cider and beer producers, who are incentivised with excise duty exemption. Small-scale cider producers receive relief on their first 7,000 litres of production, while beer producers receive 50% relief for their first 500,000 litres of production in any one year.

The campaign is supported by MP for Calder Valley, Craig Whittaker, who will put the case to the Chancellor of the Exchequer, George Osborne. Evans added that although Luddenden Valley Wines is a producer of "made-wines", the campaign should also be of interest to grape-based producers because the excise duty rules apply to them too.

"We have been operating for 14 months and we are really pleased to have got our licence, so don't want to bite the hand that feeds us," Evans said. "However, the UK's £2.00 per bottle in excise duty on a typical 5.5% to 15% abv bottle is higher than those EU countries whose wines are sold on the shelves of UK outlets, immediately putting UK-produced wine and made-wine at a competitive disadvantage to wines from those countries."

He added: "UK wine and made-wine producers are not offered any of the small-scale producer's tax relief given to cider- and beer-makers, despite the arguably higher level of initial capital investment and time it takes to plant crops, grow fruit, harvest it, process it, make wine and mature it prior to sale."

Elaine Evans said: "We understand that there are many new small wine producers in the UK. Any excise duty relief on the initial volumes of wine produced will be an immense help to any new wine business following their considerable capital investment in setting up the vineyards or orchards and their associated wineries. Not only that, but it could help new small and medium-sized wineries become more competitive while trying to establish their own products in the marketplace, especially in comparison to most European and many non-European wine producers, who pay little or no duty on their wines."

Luddenden Valley Wines produced 1,200 bottles last year and will produce 5,000 in 2013.