SWA research suggests alcohol duties are damaging the public purse
New research from the Scotch Whisky Association (SWA) has found that in the year to August 2025 alcoholic beverages contributed £3 in every £100 of inflation rises.
This follows a 14% rise in alcohol duty in the past two years, meaning that about three quarters of the price of an average bottle of Scotch is now tax.
Additionally, research from the trade body suggests that government borrowing costs will rise by £90m for every 1% increase in alcohol duty in the Autumn Budget.
These findings come at a time when Government is under increased pressure to deliver growth and ease pressure on consumers, with recent figures showing inflation has remained at 3.8%. Excise duty is one of very few levers that UK Government policy can use to directly control inflation.
The Scotch and spirits industry and its wider supply chain are calling for Chancellor Rachel Reeves to halt ‘damaging rises’ to alcohol duty.
The SWA said that a move to support spirits (such as Scotch Whisky) in the upcoming Budget will both save the public purse over £300m and allow the sector to support growth.
The Government's own figures suggest that Treasury revenue is £600m short of OBR forecasts, after two years of duty rises.
Revenue from spirits duty itself was down 17% in September compared to the same time last year.
Mark Kent, chief executive of the SWA, said: “The numbers are compelling: increasing alcohol duty drives up prices for consumers, it drives down business confidence, and dries up public finances. The Chancellor herself has said she’s not satisfied with the recent inflation levels, and this research shows just how much the soaring spirits tax contributes to those figures.
“The wide-ranging support we’ve seen across a variety of sectors for action on spirits duty is testament to the damage that multiple duty hikes do to businesses’ growth prospects and stability.”
The Scotch whisky industry generates about £7.1bn annually in GVA, while supporting 41,000 jobs in Scotland (7,000 in rural areas). UK-wide, the sector supports 66,000 jobs.
Earlier this year the SWA revealed that 1000 jobs had been lost across the sector, which it attributed to cost pressures, as Harpers reported.
More information on the SWA's campaign for fairer tax on Scotch can be accessed here.
Keywords:
Search
Digital Editions
56-58 Church Walk, Burgess Hill, West Sussex, RH15 9AN
Registered in England No. 6646125. VAT No. 938 4452 95
