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SWA: Duty freeze on spirits ‘imperative’
As the UK’s autumn Budget looms, the Scotch Whisky Association (SWA) has amplified its calls for a duty freeze on Scotch, which has “hit a ceiling” and “cannot reasonably rise further”.
The SWA has called for a duty freeze for spirits in the autumn Budget 2018
The SWA has released its autumn Budget submission, which argues that a duty freeze will boost government revenue, allow the Scotch industry to continue to invest in the UK economy and help consumers make responsible choices about alcohol consumption.
HMRC (Her Majesty’s Revenue & Customs) figures quoted by the SWA show that the spirits duty freeze in November 2017 generated an extra £163 million (US$214.4m) in revenue between February and August 2018. Revenue reached £1.937bn (US$2.55bn) during this period – a 9.1% increase year on year.
Furthermore, a study by the Centre for Economic and Business Research suggests that a continued duty freeze on spirits could increase revenue by an extra £64m (US$84.2m) in 2019/20, and by almost £200m (US$263m) by 2021.
Karen Betts, chief executive of the SWA, said: “I believe HM Treasury should continue to drive investment and growth in the UK economy by freezing spirits duty in the 2018 autumn Budget, while at the same time delivering increased government revenues.”
The SWA has calculated that the cost of an “average priced” bottle of Scotch whisky comprises 74% tax.
The SWA’s Budget submission stated: “Duty on Scotch whisky has hit a ceiling and cannot reasonably rise further. A duty freeze on spirits is imperative. The evidence set out in this submission shows that recent freezes have delivered investment and growth in the industry, and increased revenues for government.
“We are proud taxpayers and are committed to playing our part, but any reasonable observer will look at that tax burden and say ‘enough is enough’.
“The government has said it will back the industry when looking at exporting to the rest of the world. The best support it can give now is through the tax system here at home.
“Now is not the time for the chancellor to flip-flop on a decision he took less than 12 months ago. Now is the time to back our winners and continue to support the Scotch whisky industry by freezing duty in the autumn Budget.”
Earlier this year, the spirits industry hit back at reports suggesting the government could increase alcohol taxes to fund the NHS and said unfreezing alcohol duty would be “counter-productive” and “regressive”.