Alcohol duty freeze cheers Scotch Whisky producers

Alcohol duty freeze cheers Scotch Whisky producers

Mark Kent

The Scotch Whisky Association (SWA) has praised the Chancellor’s decision to maintain the current 10.1% alcohol duty rates, providing a much-needed reprieve for the sector, saying that the decision to cancel a further hike provides “much-needed stability” for distillers.

The decision shows the HM Treasury has listened to the Scotch Whisky sector’s calls to support industry, its supply chain, and consumers.

The Chancellor announced a duty freeze across all four alcohol categories. The duty rate on spirits remains at the August level of £31.64 per litre of pure alcohol, meaning that of the £15.63 average price of a bottle of Scotch Whisky, £11.40 is collected in taxation through duty and VAT – a tax burden of 73%.

With confirmation that duty will not rise further, the Chancellor recognised that supporting Scotch boosts growth, increases revenue, and limits inflation.

While today’s announcement is a positive step, Scotch Whisky continues to be taxed at a higher rate per unit of alcohol than wine, beer and cider, faces the highest duty rate among G7 nations, and is unable to access tax breaks available to other sectors through the so-called ‘Brexit Pubs Guarantee’.

Commenting on the Autumn Statement, chief executive of the SWA Mark Kent, said: “The industry is raising a dram to the Chancellor’s decision to support Scotch Whisky producers by returning to the duty freezes that have supported the industry, incentivised investment, and boosted Treasury revenue.

“With cost pressures hurting distillers large and small, the Treasury has provided some much-needed certainty and stability for the year ahead that will allow us get back to doing what we do best – making a world-class spirit, with a global reputation, which creates jobs and boosts growth here at home.

“Under the current duty system, Scotch whisky is still put at a disadvantage, based on a fundamental misunderstanding of how people consume alcohol and modern drinking trends.

“We want to continue the discussion with government about how the tax system can more closely reflect the number of units in a typical drink, rather than the strength of the finished product.

“Despite today’s duty freeze, cider is still taxed four times less than a spirit like Scotch Whisky – this is not fair and cannot be justified.”

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