Small distilleries back cut in duty campaign

By Gemma McKenna

Published: 21 January, 2015

Small distillers across the UK have come out in force in favour of a 2% cut in the rate of duty, which they maintain would boost growth in the industry.

Drop the Duty

Distillers from across the UK are supporting the 'Drop the Duty!' campaign which is being run by the Scotch Whisky Association, Wine and Spirit Trade Association and supported by the TaxPayers' Alliance. The campaign is calling for a 2% cut in alcohol duty at the next UK Budget in March 2015.

The distillers say such a cut would provide an extra £1.5 billion to the Treasury through increased investment across the industry, greater income from corporation tax and VAT, and from the benefits of jobs created in pubs, bars, restaurants, shops and the wider supply chain.

The UK's smaller producers say such punitive tax rates are stifling growth ambitions. Dom Roskrow, director of the Craft Distillers' Alliance, said: "The UK spirits industry has grown rapidly over the last 18 months largely due to the successes of craft distillers. Up and down the country there are small distilleries creating jobs, boosting tourism and raising tax revenue in towns and cities. The government should be doing all it can to develop and encourage growth in this industry rather than focusing on punitive tax measures."

Ian Hart, founder of Sacred Spirits Company in London which makes gin, said: "Our burgeoning craft spirits industry is significantly held back by the current exorbitant duty regime. We are characterised by small balance sheets and cannot finance the duty cashflows required under the present scheme. Growth is severely hindered, while craft distilleries in other countries have an easier time of it. We are stifled by duty at the current level. We can barely get started, let alone finance exports due to UK duty outflows."

Stephen Davies, managing director of Penderyn Distillery in the Brecon Beacons National Park, said: "As a craft distiller in the UK, we feel the strain of the alcohol duty on our business. The spirits we produce are of high quality, and have a reputation to match, however such punitive tax puts constraints on our growth."

Anthony Wills, founder and manager director of Kilchoman Distillery on Islay, added: "The whisky industry welcomed last year's duty freeze, but with tax still accounting for nearly 80% of an average bottle's price more action is needed. The UK is vital for many new and small distillers, both as a key market but also a base to grow exports in the future. A 2% duty cut would be a significant boost to investment in the sector."

Campaign supporters can email their local MPs about the issue - for more information visit the campaign website.

Printer friendly version