SWA Autumn Budget Submission 2017
22 Sep 2017
Chancellor, drop the dram duty!
"A truly great Scottish and British industry." That's how the
Prime Minister described the Scotch Whisky industry in a speech on
Friday 3rd March 2017. Just five days later, during the March
Budget, the Chancellor announced a 3.9% excise duty increase,
taking the total tax burden on an average priced bottle of Scotch
Whisky to 80%.
The second Budget of 2017 gives the UK government a second
chance to introduce greater tax fairness for the Scotch Whisky
industry. The Chancellor should seize the opportunity to drop the
dram duty by cutting spirits excise duty.
Official HMRC figures show that the decision to increase spirits
duty by 3.9% has negatively impacted the public purse. Spirits
revenue has fallen in the first quarter of 2017/18 by over 7%. By
cutting spirits duty at the Budget, the Chancellor has the
opportunity to grow revenue and boost the public finances.
New figures, set out in this submission, show that, for example,
by cutting spirits duty by 3.9% the government can increase revenue
by £42m in year one, and by almost £200m by the end of this
Cutting tax to increase revenue may seem counterintuitive, but
we have been here before. After the 2% cut to spirits duty in 2015,
spirits revenue - driven by the Scotch Whisky industry - increased
by 4% in 2015/16.
Both by looking back and projecting forward, we can see that
dropping the dram duty in the Budget will be good for the UK
It will also show that as we prepare to leave the European
Union, the UK government is prepared to back successful UK
industries like Scotch Whisky at home so we can flourish
Chancellor, drop the dram duty on 22nd November.
The SWA's full Autumn Budget submission is available