SWA slams proposals for Scotch whisky tax

Published: 10 January, 2013

The chief executive for the Scotch Whisky Association, Gavin Hewitt, has defined proposals to put a bottle tax on whisky as "ludicrous".

The comments came on the back of a suggestion by senior SNP advisers Professor John Kay and Sir George Mathewson, on the BBC One Scotland programme Scotched Earth, that a "tartan tax" could be levied at £1 per bottle in order to bring a £1?billion boost to the Scottish government.

It was reported by the Telegraph that both Kay and Mathewson, who have served as members of First Minister Alex Salmond's Council of Economic Advisers, believe that the extra tax would help Scotland share in the global success of the country's most successful export.

Hewitt said: "It is a ludicrous suggestion that Scotch whisky, one of Scotland's few economic success stories, should be burdened with additional taxation."

"Scotch whisky competes in the international market with other spirits and alcoholic drinks, most of which are cheaper to produce and sell at a lower price. Any new tax would be passed on to consumers, which would reduce demand, and stifle growth and new capital investment in Scotland, much of it from foreign sources."

He added that the tax would impact on jobs and damage communities which depend on the industry. "Why would a government looking for export-led recovery penalise Scotch whisky, its biggest export? It shows economic naivety about the industry."

He added: "Scotch whisky is worth more than £4 billion to the Scottish economy and has reached record levels of productivity - it contributes more in productivity than the City of London. For decades, industry success has been built, with government help, through fighting penal taxes overseas. A new tax at home would inevitably undermine that work, decrease production of Scotch whisky and other spirits produced in Scotland, such as gin and vodka, and make Scotland less competitive internationally."

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