Trade bodies unite in demand for a spirits duty freeze

• Rachel Reeves has been urged to deliver a duty freeze in the Autumn Budget 

• Bodies representing UK spirits companies have joined forces to push for fairer treatment that would deliver growth 

• Call comes amid further evidence that duty rises are not delivering Treasury revenue 

Trade associations representing hundreds of distilleries UK-wide have penned an open letter to the Chancellor Rachel Reeves, calling on her to support spirits producers with a multi-year duty freeze in November’s Budget. 

In an open letter, the Scotch Whisky Association (SWA), UK Spirits Alliance (UKSA), the Welsh Whisky Association, the English Whisky Guild and Drinks Ireland have reiterated to the Chancellor the damage that repeated rises in excise duty continue to do to the spirits sector and its supply chain, most notably hospitality. 

Excise duty on alcohol has increased by 14% in the past two years as inflationary uplifts to the original 10.1% duty rise have taken effect. Recent receipts from HMRC show that spirits duty revenue continues to fall, down £700m in the two years since the 2023 increase compared to the same period before duty was raised. Spirits duty, which has seen the largest duty rise, also shows the largest fall in revenue among all alcohol categories. 

The letter to the Chancellor highlights that while spirits make up just 15% of the alcohol units sold in the on-trade, they represent well over a third of profits, meaning they are “a lifeline” to many hospitality venues. UKHospitality, which represents hospitality businesses around the UK, recently joined the SWA’s call for a duty freeze, noting that the “disproportionate tax burden” impacts the entire supply chain including distillers. 

The groups have warned that any move to increase excise duty in November’s budget would fly in the face of the government’s growth agenda, impacting business confidence and hitting jobs, investment and growth. 

Mark Kent, Chief Executive of the Scotch Whisky Association, said: 

“The Chancellor must listen to the warning signs – the sector-wide job losses, the falling Treasury revenue, the sluggish growth of the UK economy – and move to support the distilled spirits sector with a long term excise duty freeze in the Autumn. Distillers in Scotland want to grow, export and thrive, but those ambitions must be fostered by a competitive domestic environment. Freezing duty would go some way to alleviating the pressure faced by Scotch Whisky producers, who are facing multiple global headwinds.” 

Ian Smith, Chair of the UK Spirits Alliance, said: 

“We are proud to champion the UK’s truly world-class spirits sector, representing brands that support jobs in communities across the country and that take British culture to the world through our exports. The Chancellor must recognise that this success can’t be taken for granted, and that fair treatment of spirits is proven to deliver growth, employment and investment in local communities. Committing to freezing excise duty in the Autumn Budget will deliver all three whilst also generating Treasury revenue.” 

Stephen Davies Director of the Welsh Whisky Association, said:  

“Wales’ whisky sector has grown exponentially in recent decades but our producers need to be supported here in the UK if the encouraging growth we’ve seen is to be sustained. A freeze on excise duty in the November budget will help to boost distillers’ confidence, and with it that of our supply chain and the hospitality venues that serve our spirit."

Aengus King, Director, Drinks Ireland, said: 

“Ireland’s drinks industry is a key export and fuels growth, investment and employment in communities around the country. Supporting our sector not only supports the businesses and people behind this world-class industry and its supply chain, but makes sense for long-term, sustainable economic impact. We’re joining our fellow trade associations to call on the Chancellor to deliver an excise duty freeze this Autumn, which will in turn allow those businesses to keep on delivering productivity and prosperity.”

Morag Garden, Chief Executive, English Whisky Guild, said: 

“Every region of England is now home to at least one English Whisky distillery, each playing a vital role in supporting local economies and attracting tourism. This is a growing success story for UK spirits, but it needs a stable foundation to thrive. By committing to a multi-year freeze on excise duty, the Government can back UK distillers, safeguard jobs, and unlock further investment in communities across the country." 

ENDS 

Notes to editor 

• For more information contact pressoffice@swa.org.uk 

• The letter to the Chancellor is copied below.  

Dear Chancellor,  

As organisations representing spirits brands of all sizes throughout the UK, we are calling on you to show support for spirits at this Autumn’s Budget. 

The companies we represent supports over 446,000 jobs, contributes £13 billion to the UK economy, and can be at the heart of supercharging your growth agenda. 

But an unfair duty regime, coupled with other unfavourable economic headwinds, have placed significant strains on our members. The businesses we represent are struggling – with some halting investment and even production in the UK, or looking elsewhere to invest; and others are being forced to reduce headcounts. For some of this country’s most iconic products, this is deeply worrying. 

Also concerning is the closure of UK pubs and other hospitality venues. To be clear – pubs cannot survive on beer alone. Tax revenues from spirits sold in the on-trade represent a third of all serves poured, but from just 15% of all the alcohol units sold. Spirits are the lifeline for these venues – supporting them not only supports the spirits industry, but also the wider hospitality sector. Beyond hospitality, the G7 high excise duty rate in the UK punishes wider manufacturing and farming sectors who count the cost of lower demand on top of the price paid by the spirits industry.  

That is why we are calling on you to announce a multi-year freeze for spirits, spanning the lifetime of this parliament; and to ensure there will be no further widening of the tax differential between spirits and other alcohol categories.  

The UK is a worldclass distilling nation, and such a move to freeze excise duty would demonstrate this Government’s commitment to some of the UK’s most recognisable products – whether that be gin, Scotch Whisky or others – and give our members the confidence to invest and help the government’s growth agenda. 

A duty freeze should not be seen as a handout, but an investment. Our members support jobs and growth throughout the UK – you have the chance to harness this potential, let’s grasp it and freeze duty. 

Yours Sincerely,  

Aengus King  

Director  

Drinks Ireland | Spirits  

Morag Garden 

Chief Executive 

English Whisky Guild  

Mark Kent CMG 
Chief Executive 

Scotch Whisky Association 

Ian Smith 

Chair 

UK Spirits Alliance 

Stephen Davies   

Director   

Welsh Whisky Association