The Scotch Whisky Association (SWA) has urged the UK government to take immediate actions to support Scotch producers, following significant economic challenges.
- The UK government is pressed to reduce tax burdens on Scotch whisky after a detrimental 10.1% duty increase in August last year.
- Recent data from HMRC reveals a notable 18% decrease in the export value of Scotch whisky for the first half of 2024 compared to 2023.
- Despite challenges, India remains the largest market by volume, showing a growth of 17.3% in the first half of 2024.
- SWA seeks a reduction in import tariffs and a stronger UK-India Free Trade Agreement to boost the industry further.
The Scotch Whisky Association (SWA) has formally requested the UK government, led by Prime Minister Keir Starmer, to implement supportive measures for Scotch producers. This involves alleviating the tax pressure on Scotch whisky, which saw a substantial increase in duty last year. The industry body emphasised that this move aligns with the government’s pre-election promises and is crucial to the future of Scottish whisky production.
The demand comes at a time when new figures by HMRC highlighted a significant 18% drop in the export value of Scotch whisky during the initial half of 2024 compared to the previous year. Additionally, there was a 10.2% reduction in export volumes, equating to 36 bottles exported per second as opposed to 40 per second in the previous year. This decline has been attributed to various economic challenges and market instability, putting pressure on the industry.
India continues to stand out as the largest market for Scotch whisky by volume, experiencing a 17.3% growth in the first half of 2024. These figures indicate resilience in select markets despite the overarching decline. The SWA has urged the government to expedite the UK-India Free Trade Agreement process, which could potentially lower the 150% import tariff currently imposed, advancing bilateral trade relations.
SWA’s Chief Executive, Mark Kent, stated, “The prime minister has promised to ‘back Scotch producers to the hilt.’ These figures remind us that Scotch whisky’s success depends on governmental support to navigate short-term market volatility.” He highlighted the industry’s capability to endure turbulence while expressing optimism for future growth.
The forthcoming UK Budget on 30 October offers the government an opportunity to demonstrate tangible support for the industry by addressing the adverse impacts of the previous tax hikes, which reportedly resulted in a substantial loss of revenue for the HM Treasury. Adjusting the duty would not only support the Scotch whisky sector but also potentially enhance public finances.
Concluding, the government’s prompt action is pivotal for the stability and growth of the Scotch whisky industry in today’s volatile market climates.
