Scotch Whisky Briefing 2014
12 May 2014
Exported to about 200 markets around the world, Scotch Whisky
leads the way for British food and drink in overseas markets,
accounting for about one quarter of all UK food and drink exports
and 80% of Scottish food and drink exports. Exports have increased
by 80% in the last 10 years. Sales are increasing in emerging
markets such as Russia, India and Africa. Scotch Whisky still
faces around 600 trade barriers in markets abroad and a dedicated
SWA team seeks to remove these unfair or illegal barriers to
Home market - hit by high tax
The UK is the 3rd largest market for Scotch Whisky. Despite the
alcohol duty escalator being scrapped and duty frozen in 2014,
drinkers of Scotch Whisky in the UK are penalised by high taxation.
Excise duty and VAT make up 80% of the purchase price of a bottle
of Scotch. Scotch Whisky is taxed 250 times more than cider, 50%
more than beer and 30% more than wine. Taxing all drinks according
to alcohol content would put an end to the distorted drinks market
Protecting Scotch Whisky
By law, Scotch Whisky can only be made in Scotland, however given
its success, bottles of alcohol made elsewhere are sometimes
fraudulently marketed and labelled as Scotch Whisky. The SWA's
legal department protects consumers and the industry from fake
Scotch Whisky. Its team of five lawyers handle about 70 legal cases
at any one time. The SWA also promotes the registration of Scotch
Whisky as a product of Geographical Indication (GI) overseas.
Recent GI recognition includes Malaysia, India, Panama, Turkey and
Scotch Whisky is closely linked to the environment. Distillers are
committed to promoting environmental sustainability, investing over
£1 billion in renewable energy systems over the last few years.
Producers work with suppliers to reduce the environmental impact of
the Scotch Whisky supply chain as part of a ground-breaking
environmental strategy that the industry signed up to in 2009.
Continued investment to increase productivity is evident across
the industry with current sites expanding, mothballed sites
reopening and new distilleries being built. Scotch Whisky producers
have committed £2 billion in capital investment over the next three
to four years.
Around 35,000 jobs are supported by the Scotch Whisky industry of
which 10,000 are directly within the industry. Employment is
located across the length and breadth of Scotland in both rural and
urban settings. Jobs include: distilling, bottling, warehouse
dispatch, sales and marketing, engineering, visitor centres and
research. Many are in areas where few or no alternative jobs are
available. Some of the jobs supported by the industry include:
cereal supply, plant and machinery providers, packaging
manufacturers, distribution and tourism.
Alcohol and society
The SWA has a robust code of practice on marketing and promotions
and many brands already carry responsibility messages and provide
other information for consumers. The Scotch Whisky industry
encourages responsible drinking and our members are committed to
working with government and other partners to tackle alcohol
misuse. The SWA is a member of the Responsibility Deal Alcohol
Network and provides the joint secretariat to the Scottish
Government Alcohol Industry Partnership.