Close Menu
News

SWA calls on UK govt to reverse tax hike

The Scotch Whisky Association (SWA) has launched a campaign to urge the UK government to re-think its planned spirits duty hike in August.

whisky
The SWA is asking the government to reserve the spirits tax hike announced in the spring budget

SWA’s Keep The Commitment campaign asks the government to uphold its 2019 pledge to “review alcohol duty to ensure our tax system is supporting Scottish whisky and gin producers and protecting 42,000 jobs supported by Scotch across the UK”.

In the UK’s spring budget, chancellor Jeremy Hunt announced the government will increase duty of Scotch whisky and other spirits by 10.1% from August.

Chief executive of the SWA Mark Kent said: “Over the past month, we have pressed the UK government to rethink the damaging double-digit duty rise on Scotch whisky.

“It is hugely disappointing that the industry seems to be taken for granted, and that previous pledges that have been made to the industry will not be honoured.”

In the 2019 Conservative manifesto, the government said it recognised the high tax burden on Scotch whisky. It said: “Scotch whisky is a national export that supports 42,000 jobs across the UK. Yet the tax on each bottle of Scotch sold in this country represents almost three quarters of its price. That is why over the past two years we have frozen the duty on spirits, cutting the price of a bottle of Scotch by 30p. Now, we want to do more, which is why we will review alcohol duty to ensure that our tax system is supporting British drink producers.”

However, since that promise was made the tax burden on Scotch whisky has increased from 70% to 75% of the average priced bottle, and the tax-gap between spirits and other alcohol categories has widened.

“That is why we have launched the Keep the Commitment campaign,” said Kent. “We want the UK government to understand what choosing to impose a double-digit duty hike will do to the industry, hospitality businesses and consumers. And we want MPs [members of parliament] to support Scotch whisky, including in the vote next week on the tax increased proposed by the chancellor.”

Tomorrow (18 April), MPs will vote on the Finance Bill, including the duty increases to spirits.

MP Alistair Carmichael has tabled an amendment to the Bill, which would reverse the planned 10.1% increase, taking spirits duty to £31.64 per litre of pure alcohol, and return spirits duty to £28.74

“By voting against the tax increase, MPs can send a clear message to the chancellor that he should meet the industry, reconsider the tax rise, and keep the commitment to support Scotch,” Kent added.

The Keep The Commitment campaign also calls for an immediate inclusion of distillers in the Energy Bill Relief Scheme, and for the UK government keeps the commitment made to the industry to “ensure the tax system is supporting Scottish whisky”.

In an online poll of 1,034 adults aged 18 and over in Scotland, conducted on behalf of the SWA, 72% of Scots were found to support a freeze on Scotch whisky tax in the budget.

In addition, 31% of voters said they would be less likely to support the Conservatives if the chancellor raised tax in the budget.

It looks like you're in Asia, would you like to be redirected to the Drinks Business Asia edition?

Yes, take me to the Asia edition No