What the Scotch whisky industry wants from government

The Scotch whisky industry expressed disappointment, frustration, and indignation after Chancellor John Healey failed to address their calls for fairer excise duty on spirits in his first Budget. The average bottle of Scotch whisky's tax burden would increase to 74 percent, which is a 24 percent increase over the past four years.

The Scotch Whisky Association (SWA) criticized the government for making the tax burden heavier on distillers, harming the supply chain, and reducing Treasury revenue. Rachel Reeves, Healey's predecessor, raised alcohol duty in line with RPI inflation in her 2024 Autumn Budget, but left the legacy system in place. This led to a 4.55 percent rise in spirits duty, which the SWA claims equates to a cumulative 24 percent over the past four years.

The SWA and industry stakeholders argue that the UK has the highest rate of excise duty in the G7 and among the highest in Europe, which puts distillers under severe pressure. They call for the government to cut excise duty and ensure no further widening of the duty gap between spirits and other alcohol categories. Extended producer responsibility schemes have also been criticized, with whisky firms predicting closures of glass bottle manufacturing plants in the UK due to high fees.

The £7 billion-a-year Scotch industry is also concerned about the inconsistent rollout of the deposit return scheme (DRS) across the UK, which could create trade barriers and incentivize fraud. Despite international successes in reducing tariffs on Scotch whisky imports, whisky players warn against complacency and urge the government to pursue an ambitious trade agenda to maximize access in the EU and beyond.