Whisky now worth £5bn to UK economy
Scotch whisky generates nearly £5 billion a year for the UK economy, according to new research commissioned by The Scotch Whisky Association.
On announcing the news, the trade body was today calling for a 2 per cent spirits excise duty cut to boost the industry that it said also supports more than 40,000 jobs and is the largest net contributor to the UK’s balance of trade in goods, according the new research.
The research published by the SWA - ‘The Economic Impact of Scotch Whisky Production in the UK’ - reveals that without Scotland’s national drink the UK’s trade deficit in goods of £115 billion would be 3 per cent larger.
The SWA says that the Government’s support of the industry in recent years has led to a boost in revenue for the Treasury and supported a wave of new distillery openings - 14 in the past three years.
But it claims tax remains too high at 77 per cent of the price of an average bottle of Scotch and the SWA is calling for fairer treatment.
Today’s research explains that exports of Scotch Whisky are worth around £4 billion each year, while imports in the supply chain, such as packaging for products and casks for maturing spirit, total only £200 million.
The Scotch industry’s trade balance is therefore £3.7 billion.
The SWA said the research reinforces Scotch Whisky’s position as a strategically important industry for the UK in terms of value it adds to the economy, jobs supported, investment and export performance, and should be supported by government.
The onerous 77 per cent tax on an average priced bottle of Scotch exists despite a freeze in excise in last year’s Budget, a 2 per cent cut the previous year and the scrapping of the alcohol duty escalator - which annually increased excise by inflation plus 2 per cent- in 2014.
Julie Hesketh-Laird, Scotch Whisky Association acting chief executive, said: “Scotch Whisky is one of the UK’s most strategically important industries. Without valuable Scotch exports of around £4 billion a year, the UK’s trade deficit in goods would be 3 per cent larger. And our research published today emphasises the value of the industry which adds £5 billion to the economy annually and supports more than 40,000 jobs. Burns’ Night is the perfect time to raise a dram to the success of Scotch.
“But we are calling on the government to ‘Stand up for Scotch’ by addressing the high and unfair level of taxation distillers face in their home market. The current tax of 77 per cent on an average priced bottle of Scotch is a burden on consumers and the industry. And the Government’s own figures indicate that fairer tax treatment leads to increased revenue for the public purse. We are calling on the UK Government to cut excise by 2 per cent in next month’s Budget, supporting a great Scottish and British industry at a time of uncertainty, giving us a stronger domestic platform from which to invest and grow to make a success of Brexit.”