Scotch sees painful 5% decline in UK

The UK market for Scotch whisky declined by nearly 5% last year alone, with over 4 million bottles of Scotch left on the shelves compared to 2013.

Analysis published today by the Scotch Whisky Association (SWA) reveal that the number of 700ml bottles of Scotch released for sale in the UK last year fell 4.78% to 83.3 million, from 87.5m in 2013.

Worryingly for the industry, since 2009 the UK market for Scotch has shrunk by 9.5% from 92m bottles, according to the figures from Her Majesty’s Revenue and Customs (HMRC).

David Frost, Scotch Whisky Association chief executive, said, “Scotch Whisky is a massive export success for the UK so it’s obviously disappointing to see this decline in volumes in our domestic market.”

The SWA levels blame on the “onerous” level of taxation that is applied to Scotch, which currently counts a 78% share of the price of an average bottle.

According to research published on behalf of the SWA this year detailing the economic impact of Scotch Whisky, the industry adds value of £5 billion to the UK each year and supports more than 40,000 jobs.

The SWA is campaigning alongside the Wine and Spirit Trade Association in calling for the Chancellor George Osborne to make a 2% cut in alcohol duty.

In last year’s Budget, the alcohol duty escalator was scrapped and duty on spirits was frozen – a move welcomed by the drinks industry.

Frost said, “In next week’s Budget the Chancellor has the perfect opportunity to support an important UK industry. He should cut spirits duty by 2%. This move would also benefit consumers and public finances.

“In last year’s Budget, the Chancellor highlighted Scotch Whisky as a ‘huge British success story’. We hope this year too he will show his support for this world-class manufacturing industry.”

Similarly, the British Beer and Pub Association has used the recent success of beer in the UK, outstripping other drinks categories to post a 1% growth in market share last year, to make the case for further tax cuts.

The Chancellor will be announcing his final Budget of this parliament next Wednesday, March 18.