Scots call on Chancellor to 'Drop The Dram Duty'

09 Nov 2017

Scots call on Chancellor to 'Drop The Dram Duty'

  • New polling reveals huge Scottish support for cut in whisky "supertax"
  • Voters in Scotland say Westminster should do more to back iconic product
  • Scotch industry and MPs unite to call for action in the Budget

More than two thirds of Scots want the Chancellor to cut sky-high duty rates on whisky in this month's Budget, new polling has revealed.

Some 68 per cent say Philip Hammond should reduce taxes on Scotch which now make up an onerous 80 per cent on an average priced bottle.

And 64 per cent of Scots think the UK Government should be doing more to back the Scotch Whisky industry - which supports 40,000 UK jobs including over 10,000 directly in Scotland.

The Chancellor is coming under increasing pressure to cut duty rates on whisky - known as the Scotch Supertax - after he imposed a damaging increase in his last Budget.

Philip Hammond increased duty by 3.9% in March, which has been followed by falling sales and reduced Treasury revenues.

Sales have fallen by one million bottles after the hike, while revenues were down 7% year-on-year in the first three months after the increase.

Scottish MPs from across the political spectrum are calling on the Chancellor to cut duty and boost an iconic Scottish product which is the UK's number one food and drink export.

They have backed the Scotch Whisky Association's Drop The Dram Duty campaign calling for fairer taxes on whisky - which is taxed more heavily than beer and wine.

Today's polling, carried out by Survation for the Scotch Whisky Association, reveals those demands are backed by the Scottish people.

The survey found:

  • 68% of Scots back a duty cut in the forthcoming budget, with 17% saying duty should remain the same and 4% wanting a rise.
  • 64% agree that the UK Government in Westminster should do more to support the Scotch Whisky Industry, with just 15% saying the Government is doing enough and 2% who believed the Government should do less.
  • Among potential policy announcements in the upcoming Budget, lowering the level of duty on Scotch to support the Scotch whisky industry was the most supported of the three policies tested -  with 62% of Scots supporting a duty cut (16% opposed).
  • 72% of Scots believe it is unfair that Scotch whisky is taxed at a higher level than still wine or beer

Conservative MP for Moray Douglas Ross MP said: "The Scotch Whisky industry is hugely important to Moray as well as the entire county. I was deeply concerned about the impact of the duty rise introduced by the Chancellor in the last Budget, and hope he has carefully considered the impact of any further changes in the coming weeks.

"Along with colleagues, I have been lobbying the government to protect this important industry, and hope the strong case which has been presented by the industry and politicians will be taken into account in the Budget this month."

Conservative MP for Ochil and South Perthsire Luke Graham said: "The Scotch Whisky industry is hugely important to Scotland's economy, and my constituency of Ochil and South Perthshire, but is also a significant historical and cultural icon.

"The duty rise announced in the last budget has had a major impact upon the industry, with a noticeable decrease in bottle sales, and a second duty rise in a single calendar year would be a blow to an important UK-wide spirits industry which already contributes a significant amount to the Exchequer. Therefore, I hope the Chancellor will consider the impact of any further rise very carefully as we don't want to see two increases in a year."

Karen Betts, Chief Executive of the Scotch Whisky Association, said: "We are urging the Chancellor to use the Budget to cut tax on Scotch and back this global success story.

"The Westminster Government has a real chance to show it is fully behind a leading UK manufacturing and exporting industry at a vital time, and fully behind the jobs and communities in Scotland that the industry supports.

"Using the Budget to Drop the Dram Duty will give Scotch the support it needs to go from strength to strength."

Ends

For more information on the SWA visit www.scotch-whisky.org.uk and follow us on Twitter @ScotchWhiskySWA.

With media queries, please contact Graeme Littlejohn, SWA head of external relations (0207 960 6981 or 07793547574 or email glittlejohn@swa.org.uk)

Notes to editors

  • Survation interviewed 1,004 adults in Scotland online between October 21 and 24. Data were weighted to the profile of all Scottish adults 18+. Full tables available here http://survation.com/wp-content/uploads/2017/11/Final-SWA-Scotland-Tables-1c0d0h4-201017RRDLL-v2.pdf
  • Scotch Whisky sales have also fallen by one million bottles in the first six months of 2017. Official HMRC figures show 36.7 million bottles were released for sale in the first six months of 2017 - down from 37.7 million in the same period last year.
  • The Chancellor's 3.9% duty increase in March also negatively impacted Treasury revenues - HMRC figures show that spirits revenue was down more than 7% in Q1of 2017/18, falling to £697 million from £751m in the same period the previous year.
  • In contrast, the 2% cut in 2015 saw spirits revenue rise by 4% - giving a £124 million boost to the Treasury. The freeze in 2016 led to a revenue increase of more than 7%, providing an additional £229 million into the Chancellor's coffers.
  • MPs including former Scotland Secretary Alistair Carmichael called for ministers to rethink the Scotch "supertax" in a Westminster Hall debate last month.
  • An average priced bottle of Scotch Whisky is £12.77. Of this total, excise duty is £8.05, VAT is £2.13, making total tax £10.18, while the whisky is £2.59.
  • The rate of excise duty per litre of alcohol on Scotch Whisky increased 47% between 2007 and 2017 from £19.56 to £28.74. £4 in every £5 of the cost of a bottle of Scotch in the UK goes straight to the Treasury.
  • Scotch Whisky adds £5 billion annually to the economy, is worth £4 billion in exports and supports more than 40,000 jobs across the UK.