Britain's small distillers call on the Chancellor to cut alcohol duty
21 Jan 2015
Small distillers across Britain have joined forces to call on
George Osborne to cut the rate of duty on alcohol to facilitate
growth of the industry.
Distillers from across the UK have come out in support of the
'Drop the Duty!' campaign which is being run by the Scotch Whisky
Association (SWA), Wine and Spirit Trade Association (WSTA) and
supported by the TaxPayers' Alliance. The campaign is calling for a
2% cut in alcohol duty at the next UK Budget in March 2015.
A 2% cut in duty would provide an additional £1.5 billion to the
Treasury through increased investment across the industry, greater
income from corporation tax and VAT, and from the benefits of jobs
created in pubs, bars, restaurants, shops and the wider supply
UK consumers currently pay nearly 80% tax on an average priced
bottle of spirits and almost 60% on an average priced bottle of
wine. This equates to consumers paying £10.06 in tax on an average
bottle of whisky. The British public is also against this tax, with
84% saying that this level of tax on Scotch Whisky and other
spirits is unfair.
Today, the UK's smaller producers outlined how these punitive
tax rates are stifling their growth ambitions. Commenting on the
campaign, Dom Roskrow, director of the Craft Distillers' Alliance
(CDA), said: "The UK spirits industry has grown rapidly over
the last 18 months largely due to the successes of craft
distillers. Up and down the country there are small
distilleries creating jobs, boosting tourism and raising tax
revenue in towns and cities. The government should be doing all it
can to develop and encourage growth in this industry rather than
focusing on punitive tax measures."
Similarly, Ian Hart, founder of Sacred Spirits Company in London,
explained the devastating impact the almost 80% level of tax has on
the industry: "Our burgeoning craft spirits industry is
significantly held back by the current exorbitant duty
regime. We are characterised by small balance sheets and
cannot finance the duty cashflows required under the present
scheme. Growth is severely hindered, while craft distilleries in
other countries have an easier time of it. We are stifled by
duty at the current level. We can barely get started, let
alone finance exports due to UK duty outflows."
Demonstrating his support for the Drop the Duty! campaign,
Stephen Davies, Managing Director of Penderyn Distillery in the
Brecon Beacons National Park, commented: "As a craft distiller in
the UK, we feel the strain of the alcohol duty on our business. The
spirits we produce are of high quality, and have a reputation to
match, however such punitive tax puts constraints on our growth. We
support the 'Drop the Duty' campaign in their efforts to reduce
alcohol duty and give distillers like us the support we need to be
part of a successful home-grown industry."
Anthony Wills, founder and manager director of Kilchoman
Distillery on Islay, added "The whisky industry welcomed last
year's duty freeze, but with tax still accounting for nearly 80% of
an average bottle's price more action is needed. The UK is
vital for many new and small distillers, both as a key market but
also a base to grow exports in the future. A 2% duty cut would be a
significant boost to investment in the sector."
David Frost, Scotch Whisky Association chief executive,
summarised the objectives of the campaign, commenting "Small
distillers and British consumers are being unfairly
penalised. Not only is the spirits tax rate the fourth
highest in the European Union, it is double the rate applied in
France and two and a half times higher than in Germany. We
are calling on the Chancellor to build on last year's duty freeze
to support an important, home-grown industry."
The 'Drop the Duty!' campaign wants supporters to email their
local MP and ask them to write to the Chancellor through
www.droptheduty.co.uk calling for the alcohol super tax to be
reduced by 2% in the March Budget.
Notes to editors
• The campaign website is: www.droptheduty.co.uk
• Follow us on twitter for more news and updates:
About the SWA: The Scotch Whisky Association is the industry's
representative body and promotes the long-term, global interests of
Scotch Whisky as a high quality spirit drink, of its 57 member
companies, and the Scotch Whisky industry overall.
For more information please contact:
Mob: +44 (0)7792788213
dd: +44 (0)2030472448
(For Scottish media)
Mob: 07432 605 385
dd: 0131 222 9230