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WSTA and SWA call for 2% duty cut with launch of Drop the Duty! campaign

Published:  15 December, 2014

The Wine and Spirits Trade Association and the Scotch Whisky Association have teamed up to launch the Drop the Duty campaign which calls for a 2% cut in alcohol duty in the March Budget, saying it will boost public finances by £1.5 billion. 

Drop the DutyThe trade bodies representing the wine and spirits industry have joined forces in calling for a 2% cut in dutyMiles Beale, WSTA CEO; and David Frost, his counterpart at the SWA, pictured at the launch of the Droip the Duty Campaign this morning

The alliance says that lowering "draconian" levels of duty on wine and spirits - 60% of what consumers pay for a bottle of wine goes on duty, and 80% for a bottle of spirits - would actually boost the industry's overall contribution to the economy to the tune of £3.9 billion, from £46.6 billion to £50.4 billion

According to a new industry analysis report which is released today by EY, a 2% cut in duty could have significant economic benefits including:

  • a £1.5 billion boost to public finances in 2015 through increased investment across the industry
  • an increase in the wine and spirits industry's contribution to economic activity by £3.9 billion
  • a rise in the industry's direct contribution to UK Gross Domestic Product of £0.9 billion, from £11.8 billion to £12.7 billion.
  • Greater job security - the industry directly or indirectly supports around 518,000 jobs in the UK in 2014, with the majority (69%) directly dependent on the industry's activity.

UK consumers currently pay nearly 80% tax on an average priced bottle of spirits and almost 60% on an average priced bottle of wine. On a category basis, that means 78% tax on whisky (£10.06 on an average bottle); 79% tax on gin (£10.03 on an average bottle); 76% on vodka (£9.48 on an average bottle); and 56% tax on a bottle of wine (£2.93 on an average bottle).

Miles Beale, chief executive of the WSTA, said: "The wine and spirit sector already makes a significant contribution to the wider hospitality industry and to the British economy. Independent analysis from Ernst & Young shows that the sector's economic contribution could be £3.9 billion greater if it weren't for the UK's sky-high duty rates."

David Frost, the new chief executive of the Scotch Whisky AssociationScotch Whisky Association

"New evidence shows that lowering these draconian levels of excise duty would actually boost public finances and the economy, as well as benefit consumers," said David Frost, chief executive of the SWA.

The new campaign, whose strapline is 'small drop, big cheer' is also supported by the TaxPayers' Alliance.

"Over half the cost of an average-priced bottle of wine and over three quarters of an average-priced bottle of spirits now goes straight to the Taxman. This is not only hurting hard-pressed consumers, but jobs and growth too. The Chancellor has one more chance to be fair and cut the duty on wine and spirits before the election, and it's crucial that he takes it," said Jonathan Isaby, chief executive of the TaxPayers' Alliance.

As part of the launch of the campaign today, which is to be held at the Punch Tavern in London later this morning, the campaign aims to help increase awareness of the inequality of the current alcohol duties imposed and drive consumers to contact their local MPs via the campaign website to support a 2% cut in duty.

'Drop the Duty' Campaign Facts:

When: It launches today and will run up until the March 2015 UK Budget

What: The campaign will focus on delivering a 2% cut in the current alcohol duty

Where: The Punch Tavern, 99 Fleet Street, London, EC4Y 1DE.

Who: WSTA, SWA and the TaxPayers' Alliance 

Wine and Trade Association