Scotch Whisky Association calls for duty cut in budget
The Scotch Whisky Association has urged the UK government to cut alcohol duty after the Treasury lost out on nearly £100 million in tax revenue.
Analysis of new HMRC tax receipts data by the Scotch body found that duty revenue from spirits fell to £1.87 billion between August to the end of December, following the biggest excise duty rise in 40 years.
This represents a year-onyear drop of 5 per cent, which has cost the Treasury £98m in revenue and follows Chancellor Jeremy Hunt raising excise duty on Scotch whisky and other spirits by 10.1 per cent from August 1 last year.
Mr Hunt then froze duty at its current level in his November autumn statement.
The August increase confirmed the UK as having the highest level of duty on spirits in the G7 and fourth highest in Europe, with consumers in Paris paying half the tax on a dram they would in Edinburgh.
It leaves the treasury claiming nearly three quarters of the cost of a bottle of Scotch.
Distillers have now urged the Chancellor to cut alcohol duty in his March budget to support businesses, including pubs.
Graeme Littlejohn, director of strategy at the Scotch Whisky Association, said: “There is an inescapable conclusion – the tax rise hasn’t worked, and the Chancellor should cut alcohol duty in the Budget on March 6.
“Doing so will support the public finances and businesses, including pubs and restaurants. Scotch whisky and spirits represent a third of hospitality alcohol sales – so if he wants to back pubs, then he needs to make sure spirits consumers also have the tax breaks available to other alcohol. Backing pubs is not just about pints. UK spirits duty is now almost double the EU average.
“The budget must start to turn the tide away from high taxes and towards a more dynamic approach which supports Scotch.”
At the time of the rise in alcohol duty, Scottish Secretaryalisterjackissaidtohave conceded it was “not what I wanted for the industry”.
Lib Dem MP Alistair Carmichael said it was “typical” for the Tory government to raise taxes and lose money in the process.