UK DRINKERS PAY 26% OF ALL EU SPIRITS TAX
Source: The Spirits Business
by Kristiane Sherry
7th February, 2017
The UK’s drinkers cough up more than a quarter of the EU’s entire spirits tax revenue, despite only accounting for 11% of the population, the Scotch Whisky Association (SWA) has claimed.
UK drinkers stump up 26% of all spirits duty collected in the EU, largely due to the government levying a far higher rate of duty than the European average, the Association says.
Consumers in the UK pay £7.74 in excise duty alone on an averagely priced £12.90 70cl bottle of Scotch. Across the 28 EU member states, the equivalent is £4.40.
In the UK, a 20% VAT charge is then added to the retail price topping the total tax on the same bottle of Scotch to 77%.
Consumers in only three EU countries fork out more for their drams: Sweden, Finland and Ireland.
The SWA is campaigning for a 2% cut in spirits duty to support the domestic industry, reduce prices for consumers and boost government coffers.
Following the 2015 duty cut, government figures show an additional £123 million of Treasury revenue was generated in the subsequent 12 months.
According to the Association, Scotch contributes £5 billion to the UK economy each year while supporting 40,000 jobs.
More government support is needed for the sector as the country prepares to exit the EU, it argues.
“British people pay more tax on their Scotch than is fair. This is shown very clearly when compared to other European countries,” said Julie Hesketh-Laird, SWA acting chief executive.
“The chancellor is in a strong position. He can reduce tax on Scotch whisky, help consumers as the threat of inflation grows and take the opportunity to boost one of the UK’s flagship industries. At the same time, as past experience has shown, this should lead to increased Government revenue.
“This is a common sense decision that could benefit everyone. I hope he listens to a key British industry, assesses the figures and stands up for Scotch.”
In the 2016 Budget statement, then chancellor George Osborne put a freeze on spirits duty.
The UK government is due to make its 2017 Budget statement on 8 March.