Vinarchy Blames Packaging Levy for British Profit Hit

Vinarchy UK said its British business would have posted a profit last year if not for the new packaging levy known as Extended Producer Responsibility, or EPR, after accounts showed the company was hit with at least £8 million in charges in 2025.

The tax, which took effect on Jan. 1, 2025, applies to packaging made from glass, aluminum, plastic, cardboard and wood. It affects U.K. businesses with annual turnover of at least £1 million and more than 25 tonnes of packaging handled each year. The policy was designed to shift the cost of packaging waste away from taxpayers and onto manufacturers and importers, but it has quickly become a source of frustration across the drinks industry.

Companies have complained about billing errors and duplicate charges tied to glitches in the system. Vinarchy’s accounts suggest the levy has already had a material effect on one of the world’s largest wine groups. The £8 million figure may rise further because Vinarchy’s financial year in Britain runs through June 30, meaning more EPR costs could still be booked.

Vinarchy UK is the British arm of Vinarchy, the company created when Accolade merged with Pernod Ricard Winemakers. In comments provided to The Drinks Business, chief executive Danny Celoni said the FY25 U.K. accounts mainly reflected the historical performance of the legacy Accolade Wines business before the merger. He said the combined company was now stronger and was performing in line with profit expectations, with improvements across underlying financial metrics.

Celoni also said Vinarchy was moving ahead with “significant brand, capability and capacity investments.” Those comments come as the company tries to stabilize its business after a difficult period marked by falling revenue and continued pressure on margins.

According to the accounts, Vinarchy’s revenue fell by almost £40 million last year to £422 million from £461 million a year earlier. Pre-tax losses narrowed sharply to £6.4 million from £103 million, though the earlier figure included one-off charges and writedowns. EBITDA also declined by nearly 9% year on year.

The company has already begun reshaping its portfolio. In November 2025, The Drinks Business reported that Vinarchy planned to cut about 60 wine brands, or roughly 40% of its range, as it focused on labels with broader consumer recognition. Celoni said at the time that Hardys, Jacob’s Creek and Campo Viejo would be central to that strategy.

Jacob’s Creek returned to U.K. shelves on April 6, 2026, supported by a marketing campaign built around lighter and fresher wine styles and updated packaging. The range includes four wines: Juicy & Smooth Red; Refreshing & Lively Rosé; Zesty & Fresh Sauvignon Blanc; and Vibrant & Fruity White.

Vinarchy’s experience comes as other wine companies have warned that EPR is adding costs without delivering clear benefits for recycling. Chilean producer Concha y Toro has said the levy is having as much economic impact as tariffs imposed by President Trump in the United States. Critics have argued that the system is flawed, that it will push up prices for consumers and that it could place smaller producers under even greater strain.

The Cut My Tax campaign group, which says it supports lower taxes and a more democratic economy, also criticized the levy on social media, calling it another tax that raises costs for consumers and weakens affected firms.