A Mixed Budget For Whisky Distillers (2012)

21 Mar 2012

The 5% increase in spirits duty in today's Budget penalises the Scotch Whisky industry and consumers and undermines the growth agenda for the UK economy, the Scotch Whisky Association (SWA) said.

The duty escalator Budget rise of 42 pence a bottle (duty and VAT) means that only Finland and Sweden tax Scotch Whisky more heavily within the EU.

The SWA welcomed the boost to business from the Government's immediate and ongoing commitment to reducing corporation tax.

Gavin Hewitt, chief executive of the Scotch Whisky Association, said:

"The reduction in corporation tax is a welcome boost to business but by maintaining the duty escalator the Chancellor has undermined the Government's objectives of encouraging economic growth and curbing inflation.

"The Government needs to review the duty escalator which is harming the Scotch Whisky sector. The industry is vital to economic growth and supports about 35,000 jobs across the UK. It suffers at home due to the discriminatory tax regime applied by our own government."

The SWA is calling for an overhaul of the entire duty regime through a move towards a system where all drinks were taxed at about the same rate. Scotch Whisky currently carries some 37% more duty per unit than beer and is 30% higher than wine. Duty approximation would deliver an additional £1 billion a year to the Government to help reduce the national deficit.