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Scotch whisky producers say minimum price would "breach EU rules"

Published:  02 September, 2010

Scotch whisky producers believe proposals to introduce a minimum price on alcohol would breach EU and international trade rules and cause significant damage to its industry.

Scotch whisky producers believe today's proposals to introduce a minimum price on alcohol would breach EU and international trade rules and cause significant damage to its industry.

The Scotch Whisky Association (SWA) said the Scottish Government's proposed minimum price of 45p a unit will do little to address alcohol harm in Scotland but will cause significant damage to Scotch whisky at home and abroad.

Producers believe minimum pricing would breach EU and international trade rules and copycat action in export markets - with trade barriers justified on spurious health grounds - would have a major negative impact on Scotch whisky overseas.

They say it would undermine the industry and its supply chain across Scotland at a time of economic uncertainty.

At 45p a unit, the cost of an averagely priced bottle of Scotch whisky in Scotland will increase by 16% to £12.60.

It will reduce the domestic market by nearly 13% and value and own-label brands will be particularly impacted.

Producers believe the Scottish Government commissioned model suggests the proposed price fails to meet the basic tests of EU law, with only a 4.3% fall in alcohol consumption predicted.

Gavin Hewitt, SWA chief executive, said: "We need consensus on a legal alternative. Excise duty reform so that all drinks are taxed on the same basis, according to alcohol content, and a ban on sales below tax, is a fair and socially responsible way forward. It would also raise over £1bn extra revenue for the public finances."

In response to today's announcement The Wine and Spirit Trade Association, spokesman Gavin Partington thinks setting a minimum price at 45p is "wrong in principle".

"It won't tackle alcohol misuse but will punish families on low incomes and pensioners. Surely Ministers cannot believe that making a hazardous drinker pay an extra £1.08 per week is going to solve the problem."

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