UK/Australia trade deal to save UK wine businesses £16m, claims WSTA

By The Morning Advertiser

- Last updated on GMT

'Good news': 'The benefits of a tariff-free, quota-free UK-Australia trade deal are great news for British producers exporting English wine and spirts to Australia,' Miles Beale, chief executive of the WSTA said
'Good news': 'The benefits of a tariff-free, quota-free UK-Australia trade deal are great news for British producers exporting English wine and spirts to Australia,' Miles Beale, chief executive of the WSTA said

Related tags: Wine, Australia, United kingdom, Government, Finance, Trade, brexit, European union

The first major trade deal negotiated by the Government since the UK left the EU has been welcomed by the Wine and Spirit Trade Association (WSTA) for reducing costs for drinks businesses and positive knock-on effects for hospitality firms.

According to the WSTA – which represents more than 300 companies producing, importing, transporting and selling wine and spirits – UK-based drinks makers are celebrating the Government’s free trade agreement with Australia. 

The trade body claims that the deal – which eliminates tariffs on all UK goods – will reduce the cost for exporters and importers alike and will mean greater choice for UK consumers.

In 2020, the UK exported £27m worth of gin to Australia, which was one of the few markets to continue growing during a year in which exports were heavily hit by the pandemic. 

UK distillers are expecting to see those exports continue to grow, with an agreement likely to remove the 5% tariff Australia levies on the spirit. 

Supporting a huge industry

What’s more, the free trade agreement will also see tariffs removed on wine imports from Australia. It has suggested that removing import tariffs will save UK wine businesses £16m and support thousands of jobs.

The tariffs plus VAT translated to an added burden of 10p to 11p per bottle, depending on ABV, prior to the deal according to the WSTA. 

With 80% of Australian wine arriving in bulk, the trade supports a huge industry in the UK, from bottling plants and logistics networks to marketing and promotion services. 

Removing the tariffs and cutting unnecessary regulatory barriers will support a wide range of jobs across the UK’s wine industry, the WSTA claims. 

Announcement ‘historic’ and ‘well worth celebrating’  

The trade body also expects the UK-Australia deal to benefit the UK’s 900 independent wine merchants and allow the hospitality sector to offer greater choice and better value to customers. 

“The benefits of a tariff-free, quota-free UK-Australia trade deal are great news for British producers exporting English wine and spirts to Australia,” Miles Beale, chief executive of the WSTA said.

“It’s also good news for importers as it will enhance the UK as a global hub for wine trading and will ultimately benefit UK consumers too.

“This historic announcement is well worth celebrating, with a glass of your favourite Australian wine,” he added. “We hope further free trade deals with other countries are hot on its heels.”  

'Removing unnecessary tariffs' 

Simon Lawson, general manager of Casella Family brands, Australia’s largest family-owned wine company, added: “This deal is fantastic news which will further strengthen UK consumers love affair with Australian wine by removing unnecessary tariffs. 

“As a family run business with an eye on the long term, this deal will renew our commitment to investing in the UK for our leading brand [yellow tail], our premium wines and our hub for the wider European market.”   

In 2019, total sales of Australian wine contributed £770m in duty and VAT to the Treasury.

Related topics: Wine

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