In Late December 2022, the UK Government announced it would extend the alcohol duty freeze, due to end on 1 February 2023, by six months to 1 August 2023. This was a welcomed relief and provided greater assurance for the Australian wine sector, which has faced uncertainty around duties for wine exported to the UK, following ongoing revisions and changes of UK Government in late 2022.
On 15 March 2023, as part of the UK’s Budget Statement, Chancellor Hunt, announced that the freeze to alcohol duty will end on 1 August 2023 and the UK will increase alcohol duty by inflation – at 10.1% RPI. This tax rise will mean that duty on a bottle of still wine will go up by 44p. For fortified wines the duty rises will be even greater, with fortified wine set to rise by £1.30.
Following this announcement, the UK Government confirmed the final policy decision to the alcohol duty reforms, which were published alongside the Finance Bill. The response to the reforms confirms the final details of the new alcohol duty system, including the new Small Producer Relief and Draught Relief, and should be considered alongside previous responses, which can be found on the same webpage.
This document also confirms the duty rates from 1 August 2023, which can also be found in Annex A of the Spring Budget documents.
The Trade (Australia and New Zealand) Bill 2023 has passed its final stage, the Royal Assessment which signifies the final parliamentary process before a bill can be passed into law. There remains a final 40 day period before the UK process can be confirmed as complete and a further 30 day period following an exchange of letters between Australia and the UK before the FTA will officially enter into force. Entry into force is therefore expected around mid-2023.
On 31 March 2023, Minister for Trade and Tourism, Senator the Hon Don Farrell, announced he had met with his counterparts from across the Comprehensive and Progressive Agreement for Trans-Pacific Agreement for Trans-Pacific Partnership (CPTPP) and the United Kingdom to agree that negotiations for the UK’s accession to CPTPP had reached substantial conclusion.
Substantial conclusion means officials have reached agreement on all substantial issues. Work is ongoing to finalise the necessary legal instruments to enable the UK to join the CPTPP. CPTPP Ministers will meet at the 7th Annual CPTPP Commission meeting in Auckland in July 2023 to discuss conclusion of the UK accession process.