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Wine and spirit industries to unite in combined campaign for 2% duty cut in 2015 Budget

Published:  05 December, 2014

The wine and spirits industry is to unite under a combined campaign and consider calling for a 2% cut in alcohol duty in the 2015 Budget.

If the Chancellor agreed to such a move it would raise extra revenues for the Treasury through higher employment, more excise taxes and bigger VAT returns.

That will be the central claim of a joint Budget campaign by the Wine & Spirit Trade Association and Scotch Whisky Association.

It will use new economic mapping research from Ernst & Young that has analysed the impact of either an inflationary increase, freeze in duty, or a 2% cut. Its findings show the 2% cut would not only be a welcome boost to the public and government in the last Budget before the 2015 General Election, it would help boost Treasury coffers. 

The news comes on the back of the small print in this week's Autumn Statement that, according to the Office of Budget Responsibility, the Treasury will receive £100 million less in alcohol duty in the tax year due to a downturn in people drinking wine.

Be Fair George, Call Time on Duty!Be Fair GeorgeWSTA's Call Time on Duty was a success, but chief executive Miles Beale is already looking towards the next battle: reducing the duty on wine & spirits

Ernst & Young's economic study ahead of this year's Budget, which showed how the scrapping of the duty escalator would help create jobs 6,000 jobs and raise £230 million for the Treasury, was seen as a key factor in the success of the WSTA's Call Time on Duty campaign.

The WSTA wants to build on the success and impact of the Call Time on Duty Campaign with a more co-ordinated, cross industry initiative which why it is working hand in hand with the SWA.

It will once again have the support of the Tax Payers Alliance and hopes to also have other consumer and business support groups on board as well as work much closer with the beer and hospitality sectors.

The new campaign is being officially launched to the trade and media soon where full details of the Budget 2015 campaign will be presented by WSTA chief executive, Miles Beale and SWA chief executive David Frost.

Harpers, though, can reveal today that the new duty campaign will include:

* a call to all members of the wine and spirits industry to send a personalised templated letter to their local MP calling on their support to call for a 2% duty cut

* setting up Parliamentary regional drop-in events where local MPs in a given area will be invited to come and meet local drinks companies, wineries, distillers and merchants. These would be held in Westeminster. Similar initiatives have already worked well in Scotland where MPs have visited distilleries and met local connected businesses where they can see the importance of a strong, profitable whisky industry.

* asking supportive MPs to set up a Parliamentary debate on the issue of alcohol taxation before next year's Budget

* produce case studies to demonstrate the positive impact on jobs a 2% duty cut would bring in key parts of the country.

William Boyack, media and public affairs manager at WSTA, said it was hopeful its strong support amongst MPs will help give the campaign real momentum in 2015. He said the new campaign will make it even easier for people to download and send off letters to their local MP and he hoped more drinks businesses, their employees and suppliers would take part.

With so many MPs openly in favour of measures that help the future of the British pub, seen in the duty cuts beer has received in the last two budgets, the new campaign will also highlight the importance of wine and spirits to the pub sector and how duty cuts there would have an even stronger knock-on effect to their long term future.

Rosemary Gallagher, communications manager of the Scotch Whisky Association, said it was releasing research in January, produced by 4 Consulting, that outlines the economic impact of the whisky industry and its importance not only to the finances of Scotland, but its knock on effect through the supply chain right across the country through packaging, glass, bottling companies.

Both the WSTA and SWA will also be doing consumer polling in the new year to assess public support for duty cuts.

Harpers will be working with the WSTA and SWA to help co-ordinate trade support for the campaign and will again call on wine producers arond the world to write to the Chancellor setting out their concerns about high duty rates and how it makes the UK uncompetitive versus exporting to other main wine markets around the world.

The WSTA is also set to launch its own manifesto for the 2015 General Election in January outlining the areas it would like to see support from the main political parties.