Cut alcohol duty, spirit distilleries warn Chancellor Jeremy Hunt

Scottish whisky and gin makers have called on Jeremy Hunt to slash alcohol duty ahead of the Spring Budget.

They say the rate of tax on spirits – the highest in Europe – is placing extra stress on businesses as they struggle with higher costs.

It comes after moves made at last year’s Spring Budget means that up to 80 per cent of the price of a bottle of spirit is taken as tax, including duty and VAT.

Businesses say the tax burden on spirits is ‘unsustainably high’.

Producers fear without a duty cut, venues will be forced to hike prices even more for customers.

In a letter seen by the Mail, trade associations representing over 400 drinks producers and hospitality venues have urged the Chancellor not to turn his back on iconic homegrown products such as whisky and gin. 

The letter said: ‘Not only would a cut in alcohol duty help reverse this trend of depressed consumer spending, but it would also generate revenues to the Exchequer at a time when it is needed most.’

Last August, taxes on all alcohol went up but under the Government’s ‘Brexit pubs guarantee’ relief was given to draught beer.

But the spirits industry groups said this was unfair and disastrous as duty on their drinks increased by more than 10 per cent.

Chris Jaume, owner of Cooper King Distillery in York and UK Spirits Alliance spokesman, said: ‘It’s been a difficult few years grappling with Covid, spiralling costs and a cost of living crisis, and we’ve now been hit hard by the duty rise. It’s effectively an unfair tax on consumers who want to support their local distillery.’