SWA takes case for duty cut direct to Treasury

03 February, 2016

The Scotch Whisky Association made its case for a further 2% cut in spirits duty directly to the Treasury this week.

The SWA is campaigning for the Chancellor George Osborne to follow last year’s 2% cut in excise duty on spirits with a similiar in this year’s Budget, due on March 16.

Representatives from the SWA met with Treasury minister Damian Hinds MP yesterday to press for action.

The SWA recently revealed that last year’s cut in duty actually boosted the Treasury’s revenues from spirits by 4% or £96 million between its introduction in April and the end of the year.

Duty on spirits accounts for 76% of the price of an average bottle of whisky.

In its submission to the Treasury, the SWA highlighted the fact that spirits drinkers pay 51% more tax on the same amount of alcohol than beer drinkers do, and 27% more than wine drinkers.

The tax on spirits is among the highest on any product in the UK.

According to a recent survey conducted on behalf of the SWA, some 85% of UK respondents thought the status quo unfair, with that figure rising to 92% in Scotland.

Last year’s cut in duty, the SWA argues, helped encourage smaller distilleries to enter the market.

Seven new distilleries opened last year, and some 30 or 40 are at the planning stage.

David Frost, chief executive of the SWA, said: "We had a constructive discussion with the Exchequer Secretary to the Treasury, highlighting the significant increase in Government revenues this year - nearly £100m - as a result of the spirits duty cut in March, as well as the boost that decision gave to distillers, large and small.

“We hope the Government will build on last year's decision by once again cutting excise by 2% and helping to reduce from the current onerous 76% the tax take on an average priced bottle of Scotch. We would like to see fair tax for whisky and we're asking the government to stand up for Scotch.

"We explained how a reduction in excise in next month's Budget would support public finances, promote investment and jobs across the UK and continue the progress made towards fairer tax for one of the UK's most iconic and successful industries.  

“In short, when unnecessarily heavy tax is cut, revenues actually go up, and consumer and industry confidence is boosted."

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