Last year’s 2% cut on excise duty helped the Treasury increase its take from the tax on UK spirits sales by 4% to £96 million, new figures reveal.
The uplift in Treasury revenue from the measure, which was announced in George Osborne’s March 2015 Budget, has led the Scottish Whisky Association to call on the government to go further this year.
The SWA is calling on the Chancellor to “Stand Up For Scotch” and to cut another 2% from the excise in his forthcoming 2016 Budget.
David Frost, chief executive of the SWA, said: “The Government’s own figures tell a simple story: when tax is too high, if you cut it, revenues go up not down.
“Along with the British public, we believe that the current tax of 76% on a bottle of Scotch is too high.
“An ordinary drinker will hand over almost ten pounds in tax on each bottle they buy. We would like to see a 2% cut again this year.
“George Osborne listened to the industry last year when we said that a cut on duty would increase confidence, safeguard jobs, help consumers, and thereby ultimately benefit the Treasury.
“We now have the figures to prove it. That’s why this year we are asking the Chancellor to continue what he has started.
“Deliver fair tax for whisky, free the industry to invest and grow, and feel the benefit through increased revenue.
“It really is common sense to stand up for Scotch.”
The Scottish whisky industry support more than 40,000 jobs in the United Kingdom, many in otherwise deprived rural areas, and is reponsible for some £4 billion in export sales.
Last year’s cut in excise duty was the first for 20 years and has helped drive investment in the sector.
There are currently some 117 licensed whisky distilleries in Scotland, but a further 30 to 40 are in the planning stage.
Jonathan Isaby, chief executive of The TaxPayers’ Alliance, said: “Piling taxes onto spirits hits those on lower incomes the hardest, only adding to the cost of living.
“Last year’s bold move by the Chancellor helped the industry and the ordinary drinker but also saw a boost for the public finances, which was a clear demonstration that cutting taxes can increase revenues.
“Mr Osborne would do well to give taxpayers and businesses another timely boost at the coming Budget.”