UK Market Even Tougher

The UK government released their 2008 financial budget, which includes excise tax details for wine and spirits. Excise taxes increased 14 pence (10.5%) per bottle, effective immediately. In the past, tax increases were generally in the range of 3-6p per bottle."Given downward pricing pressure from UK retailer, wine producers typically have been forced to absorb these excise tax increases, thus negatively impacting their margins. We estimate for roughly every 5p excise tax increase that STZ absorbs, earnings are impacted by