WSTA launches campaign to cut duty by 2%

The Wine and Spirit Trade Association has launched a campaign calling for a 2% cut in duty on wine and spirits, which it says would result in a £1.5 billion boost to public finances in 2015.

Miles Beale, chief executive of the WSTA, with David Frost, chief executive of the SWA

The Drop the Duty! campaign, supported by the TaxPayers’ Alliance and the Scotch Whisky Association (SWA), was unveiled today at The Punch Tavern in London with the aim of raising awareness of the “extremely high” rate of tax that UK consumers currently pay on wines and spirits.

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

David Frost, chief executive of the SWA, said: “If you buy a bottle of Scotch Whisky to celebrate Christmas and New Year, nearly 80% of the average price you pay goes straight to the Government. This is unfair on both consumers and the Scotch Whisky industry. We are calling for George Osborne to do the right thing and cut excise duty by 2% in next year’s Budget. New evidence shows that lowering these draconian levels of excise duty would actually boost public finances and the economy, as well as benefit consumers.”

A 2% cut in duty would boost public finances by £1.5bn, according to independent analysis by Ernst Young, through increased investment across the industry, greater tax income from corporation tax and VAT and from more jobs created in pubs, bars, restaurants, shops and the wider supply chain due to increased confidence in the industry.

The report also said that a 2% cut  would see the UK’s Gross Domestic Product increase by £0.9bn, from £11.8bn to £12.7bn.

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 EY 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. By cutting the duty on wine and spirits at the next Budget the Chancellor would provide welcome relief for the British public, boost jobs and growth and generate an additional £1.5bn for the public finances.”

The Drop the Duty Campaign follows the WSTA’s successful Call Time on Duty Campaign, which last year saw the UK government scrap the Alcohol Duty Escalator.

For more information and to get involved in the campaign click here.