Craft distillers demand equal duty relief
A group of distillers is urging the UK chancellor to include spirits in the Small Producer Relief (SPR) scheme, calling the current system “discriminatory” as it only benefits lower-ABV products like beer and cider.
Liam Hirt, founder of Bristol’s Circumstance and Psychopomp Distilleries, has penned a letter to UK chancellor Rachel Reeves ahead of the autumn Budget on 26 November 2025.
Co-signed by 16 other distillers, the open letter asks for parity with companies that make beer and cider, which benefit from a lower rate of alcohol duty through the Small Producers Relief scheme.
Under the scheme, companies that create products with an ABV of 8.5% or under are subject to a reduced rate of alcohol duty. This subsidy is only available to businesses that produce 450,000 litres or fewer of pure alcohol per year.
Due to the alcohol-strength limitation, small distilleries that typically make products with an ABV of 37.5% or higher are not able to take advantage of the scheme.
SPR was introduced in August 2023 as a “radical simplification” of the alcohol duty system, but it essentially replaced the Small Brewers’ Relief scheme.
The letter says the SPR scheme “undermines its goal of supporting small businesses and innovation across the UK drinks industry”.
Hirt said: “Duty relief for beer and cider has proven its value. It has helped small producers compete with global corporations, encouraged hundreds of new entrants, and driven diversity and innovation.
“Extending the same support to spirits would deliver exactly the same benefits – and strengthen the UK’s position as a world leader in craft distilling.”
The Wine and Spirit Trade Association (WSTA) also believes the scheme should be extended to the wine and spirits industry.
‘Gin is no more harmful’ than beer
Hirt said the limitation “discriminates against distillers” and is not backed by any public health basis.
He continued: “A unit of alcohol in a gin is no more harmful than a unit in a beer. In fact, many spirits consumed with low- or zero-sugar mixers have fewer calories than most beers or ciders.
“According to recent HMRC [His Majesty’s Revenue & Customs] data, spirits duty receipts have fallen by up to £700 million [US$915,411m] over the past two years, despite duty increases.
“A reformed, inclusive SPR could reverse this decline by encouraging investment, compliance, and sectoral growth – boosting long-term revenues for the Treasury.”
Citing data from the Scotch Whisky Association, Hirt noted spirits sales now represent 38% of pub alcohol profits.
‘Reward innovation, not penalise it’
“The UK’s duty framework should reward innovation, not penalise it,” Hirt warned.
“Including spirits in Small Producer Relief would deliver fairness, drive exports, and strengthen the entire drinks ecosystem – from distilleries to pubs to the Treasury.”
The open letter has been signed by: Richard Foster (Exploring Whisky), Shaun Ward (Ludlow Distillery), Paul Abbott (Grasmere Distillery), Jordan Lunn (West Midlands Distillery), Anthony Dillon (Spirit of Birmingham), Stephen Russell (Copper Rivet), Jordan Morris (Abingdon Distillery), Jared Cave (Integrity Malts), Ben Mordue (Elsham Wold Distillery), Laurence Conisbee (Wharf Distillery), Matt McKay (London Distilling Co), Karl Bond (Forest Distillery), Phil McLaughlin (Weetwood), Dan Humphrey (Summerton Whisky Club), Amy Seton (Grain & Glass), and Tim Etherington-Judge (Avallen).
Trade bodies are also urging the government to freeze duty on spirits, which rose by 10.1% in August 2023.
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