Scotch Whisky – a vital UK industry
19 Feb 2016
2% excise cut would encourage growth
Scotch Whisky is a star performer for the UK economy in overseas
markets and without its success Britain would have a substantially
larger trade deficit, new figures published today reveal.
The figures show that Scotch is the biggest net contributor to
UK trade in goods. Exports are worth almost £4 billion, while
imports in the supply chain, such as packaging for products and
casks for maturing the spirit, total only £200 million. The Scotch
industry's trade balance is therefore £3.8bn. Without the success
of Scotch, the UK's trade deficit of almost £35bn would be 11%
This is among the key findings of new figures released by the
Scotch Whisky Association on the 'Economic Impact of Scotch Whisky
Production in the UK', which updates some of the analysis published
at the start of the last year.
Other findings include:
- Value added to the economy is up 1.6% to just over £5bn
- The industry invests £1.7bn a year in its supply chain, almost
all in the UK
- Scotch Whisky supports salaries worth £1.4bn to UK workers
- The industry plays an important role in rural communities where
it employs 7,000 people.
The Scotch Whisky industry is expanding at historic levels. Nine
new distilleries have opened in the last two years and up to a
further 40 are planned across Scotland. Significant
investments have been made in warehousing and bottling capacity, as
well as renewable sources of energy.
Last year's 2% cut and the spirits duty freeze and scrapping of
the alcohol escalator in 2014 gave a boost to confidence in the
industry, helping to support the conditions for investment.
Despite the improvement in the last couple of years, tax,
including excise and VAT, on an average priced bottle of whisky
stands at an onerous 76%. Last year's spirits duty cut actually
helped boost government tax receipts on spirits by £96 million
between April and December, compared to the same period in 2014.
There is every reason to think that a further reduction would
benefit UK revenues once again, as well as the Scotch Whisky
industry and consumers.
David Frost, Scotch Whisky Association chief executive, said:
"These figures re-emphasise how significant the Scotch Whisky
industry is to the Scottish and wider UK economy, adding more than
£5bn of value and supporting around 40,000 jobs. But it may
surprise some people that Scotch Whisky is now the number one
contributor to the UK's balance of trade in goods and that the
trade deficit would be 11% higher without whisky exports.
"Given the scale and impact of the Scotch Whisky industry, we
believe the government should re-double its efforts to support
distillers. At home, in the short term, a further 2% duty cut
in next month's Budget would be a major boost, supporting small
businesses that rely on the home market and further investment in
Notes to editors
With media enquiries, please contact: Rosemary Gallagher, SWA
head of communications, 0131 222 9230 or 07432 605 385 or email@example.com
For more detail please the attached economic snapshot (based on
2014 figures, the most recently available). This updates some of
the report by 4-Consulting on The Economic Impact of Scotch Whisky
published by the SWA in January 2015.
TOP FIVE CONTRIBUTORS TO UK TRADE BALANCE IN 2014 - EXPORTS
MINUS IMPORTS (AND PLEASE SEE INFOGRAPHIC IN BELOW SNAPSHOT) -
- Scotch Whisky £3.8 billion*
- Mechanical machinery £3.4bn
- Beverages (including Scotch Whisky) £1.4bn**
- Works of art £1.2bn
- Fertilisers and other chemicals £0.5bn
(Source: ONS and SWA. *Scotch Whisky is not published as a
separate category in the ONS tables. This figure is from SWA
interpretation. **In the ONS tables Scotch is included under the
NEW DISTILLERIES OPENED IN LAST TWO YEARS (2014 & 2015) -
Annandale, Arbikie, Ardnamurchan, Ballindalloch, Dalmunach, Eden
Mill, Glasgow Distillery, Isle of Harris, Kingsbarns.