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Scotch celebrates UK-Australia trade deal

The UK has secured a free trade agreement with Australia, which will bring an end to the 5% tariff on Scotch whisky.

Australia Brexit
Australia has agreed a free trade agreement with the UK, eliminating tariffs for Scotch whisky

The agreement in principle between the two nations was announced today (15 June) and will eliminate tariffs on all UK goods.

Boris Johnson, UK prime minister, said: “Our new free trade agreement opens fantastic opportunities for British businesses and consumers, as well as young people wanting the chance to work and live on the other side of the world.

“This is global Britain at its best – looking outwards and striking deals that deepen our alliances and help ensure every part of the country builds back better from the pandemic.”

Trade body the Scotch Whisky Association (SWA) welcomed the free trade agreement.

Karen Betts, chief executive of the SWA, commented: “It’s very good to see the removal of the 5% tariff on Scotch whisky in the agreement in principle between the UK and Australia. This will help Scotch whisky distillers continue to expand exports to Australia, which have almost doubled over the last decade, making Australia our eighth largest market by value.

“It’s also important to us that trade with Australia is now tariff-free for Scotch whisky – our preference is always for tariff-free trade, which enables Scotch whisky to compete on a level playing field and on the strength of our reputation for quality.

“We await further details of the agreement in principle. A framework for addressing regulatory barriers to trade with Australia, to ensure greater legal protection and tax fairness for Scotch whisky, is also important to us, and – if delivered in this agreement – will be a real boost for the industry.”

In other tariff news, last month US distillers were relieved to hear the EU would temporarily suspend its proposed tariff increase on American whiskey. The UK government also started a six week consultation on US tariffs last month, which could remove duties on American whiskey.

US tariffs on single malt Scotch, introduced in October 2019, have already cost the sector more than £500 million (US$682m) in exports, the SWA warned in February this year.

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