Small distillers across Britain have joined forces to call on George Osborne to cut the duty on alcohol to help the industry.
Distillers from across the UK have come out in support of the Drop the Duty! campaign calling for a 2% cut in alcohol duty at the UK Budget in March.
They estimate a 2% cut in duty would provide an additional £1.5 billion to the Treasury through increased investment across the industry, and greater income from corporation tax and VAT.
They say there would also be a benefit in jobs created in pubs, bars, restaurants, shops and the wider supply chain.
UK consumers pay nearly 80% tax on an average-priced bottle of spirits, and almost 60% on an average-priced bottle of wine equating to £10.06 in tax on an average bottle of whisky.
In a recent survey, 84% of people said the level of tax on Scotch whisky and other spirits is unfair.
The UK’s smaller producers say the punitive tax rates are stifling their growth ambitions.
Dom Roskrow, director of the Craft Distillers’ Alliance, said: “The UK spirits industry has grown rapidly over the last 18 months, largely due to the successes of craft distillers.
“Up and down the country there are small distilleries creating jobs, boosting tourism and raising tax revenue in towns and cities. The Government should be doing all it can to develop and encourage growth in this industry rather than focusing on punitive tax measures.”
Ian Hart, founder of the Sacred Spirits Company in London, said: “Our burgeoning craft spirits industry is significantly held back by the current exorbitant duty regime.
“Growth is severely hindered, while craft distilleries in other countries have an easier time of it. We are stifled by duty at the current level. We can barely get started, let alone finance exports, due to UK duty outflows.”
Anthony Wills, manager director of Kilchoman Distillery on Islay, added: “The whisky industry welcomed last year’s duty freeze but, with tax still accounting for nearly 80% of an average bottle’s price, more action is needed.
“The UK is vital for many new and small distillers, both as a key market and a base to grow exports in the future. A 2% duty cut would be a significant boost to investment in the sector.”
David Frost, CEO of the Scotch Whisky Association, one of the campaign’s main backers, said: “Small distillers and British consumers are being unfairly penalised.
“We are calling on the Chancellor to build on last year’s duty freeze to support an important, home-grown industry.”