Carmichael condemns Tory tax hike on whisky and gin producers

Orkney and Shetland MP, Alistair Carmichael, has today condemned the Conservative government’s duty hike on whisky and other spirits, which came into force this week. The 10.1% tax rise on spirits producers was passed earlier this year as part of the Budget. A campaign by Mr Carmichael to freeze the tax, backed by the Scotch Whisky Association, was voted down by the government.

Data from the UK Spirits Alliance suggests that distillery numbers in the UK have grown from 190 to 820 in the last seven years, while the spirits industry supports over 446,000 jobs and contributes £13 billion to the UK economy. UK spirits duty is currently 77% higher than the EU average and is higher in the UK than any other alcohol category. Real-world excise duty receipts data show that the Government has been able to raise more in tax when it has frozen or reduced spirits duty than when it has increased it. HMRC receipts were up by 8.3% in 2021/21, building on a 1.6% increase in 2019/20, and spirits duty was frozen in both years.

Mr Carmichael said:

“The Scotch whisky industry is the jewel in the crown of Scotland’s food and drink industry, and distillers have turned Scottish gin into an icon in its own right. We are rightly proud of the diverse and successful drinks producers we have in the Northern Isles – the last thing our distillers need is another tax rise driving price inflation.

“When I was in government we delivered not just a freeze but a cut in spirits duty. It was a massive boost for the industry and actually increased the money coming in to Treasury.

“That is why earlier in the year I lodged an amendment to cancel the increase and freeze the rate of duty on whisky and other spirits. Tories like Douglas Ross and Alister Jack chose to follow their party interests first rather than helping local businesses. Now distillers are paying the price for their choice.

“Scottish Conservatives have never been slow to talk up industry concerns when it was the SNP and Greens causing chaos and confusion over the Deposit Return Scheme or advertising bans. Their silence now speaks volumes.”