Rise in spirits excise duty 'has cost Treasury more than £100 million'

The Scotch Whisky Association (SWA) has called on the next government to reverse last year’s increase in duty on spirits, stating it has “backfired” and cost the Treasury more than £100m.

Tax revenues on sales of spirits had fallen by £108m in the period from August 2023 to May 2024, compared with the same period the year before.

The SWA blamed the drop on the 10.1% increase in excise duty that came into force in August, which it described as the biggest such rise for more than 40 years.

It said the UK has the highest level of duty on spirits in the G7, and called on the next government to rule out further increases and bring excise duty into line with the European average over the course of the parliament.

Graeme Littlejohn, director of strategy and communications at the SWA, said: “Month by month it becomes more clear that the double-digit tax hike on Scotch whisky and other spirits has backfired.

“It slowed the fall of inflation and has reduced revenue by over £100m.

“With all political parties ‘going for growth’ in this election campaign, the first budget of the new parliament should start to unwind this damaging tax increase and reduce the tax burden on Scotland’s national drink.”

According to the SWA, tax accounts for around three quarters of the price of a bottle of Scotch.

The Treasury was contacted for comment, but said it was unable to do so in the run-up to an election.

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