UK Scotch sales plummet by 1m bottles 'due to tax increase'

HeraldScotland A Scotch whisky bottling line

UK Scotch sales plummet by 1m bottles 'due to tax increase'

The Scotch whisky industry has denounced the chancellor for his tax increase on spirits after domestic sales fell by one million bottles in the first half of this year.

Official figures from HM Revenue & Customs show that 36.7 million bottles were released for sale in the United Kingdom between January and June, down 2.6 per cent on the first six months of previous year.

"The 2.6% fall follows the Chancellor's decision to increase spirits duty in the spring Budget by an inflation-busting 3.9%, meaning tax now makes up an astonishing 80% of the cost of a bottle of Scotch", says the Scotch Whisky Association (SWA), the trade body for the industry.

"The chancellor should use his November budget to drop the dram duty and boost a great British success story".

Charandeep Singh, spokesman for the Scottish Chambers of Commerce, said: "The Scotch Whisky Association is right to highlight the damaging effect that the hike in spirits duty has had on Scotch sales within the UK".

SWA chief executive Karen Betts added: "Philip Hammond's damaging 3.9% spirits duty hike has hit United Kingdom demand for Scotch and seen less money going to the Treasury".

The SWA said a 2% duty cut in 2015 had led to a 4% rise in spirits revenue, giving an additional £124m to the Treasury, while a duty freeze in 2016 had led to a revenue increase of more than 7%, or £229m. Spirits revenue was down more than 7 per cent in the first financial quarter of 2017/18 to £697 million from £751m last time.

The Rare Whisky Apex 1000 index, tracking the value of 1,000 of the world's rarest whiskies, rose by 42 per cent between July 2016 and the end of July this year - and it has risen by 195 per cent over the past five years.

A Treasury spokeswoman said: "We recognise the importance of the Scotch Whisky industry".

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