Support Our Spirits – Trade Bodies Unite In Demand For A Spirits Duty Freeze

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.”