A cut in duty on alcohol announced as part of the autumn budget has been met with a mixed response from business in Tayside and Fife.
Chancellor of the Exchequer Rishi Sunak has unveiled a series of reforms to alcohol taxes from February 2023.
They include a 5% cut in duty on draught products to help support pubs.
There were duty cuts for cider and beer and a reduction for sparkling wines such as Champagne and prosecco.
Mr Sunak said they were “no longer the preserve of wealthy elites”.
The reduction brings it in line with still wine, ending an “irrational” 28% duty premium.
Eden Mill reaction
The news has been welcomed by Paul Miller, co-founder of St Andrews-based Eden Mill.
He said: “Particularly with other cost increases that we’re being hit with, to have this benefit at least helps us.
“It is a real positive that the needs of the industry are being listened to.”
Mr Miller said the freeze will allow price increases will be kept to a minimum.
“For consumers it means prices rises will not be as significant as they could have been if we were reflecting the increases we’re having to absorb.
“To add duty on top of that would have meant a significant increase for prices.
“This helps avoid that a little bit.”
‘Not the news we were hoping for’
But Kim Cameron, of Gin Bothy, was disappointed more wasn’t being done for distilleries.
She said: “There is relief for beer and cider producers but there isn’t duty relief for distilleries.
“There is no benefit to distillers at the moment, and that is a concern.
“It is not the news we were hoping for, but it will definitely benefit small breweries and cider producers.
“We were hoping for a reduction on export duty, which hasn’t happened.
“There are still people lobbying for that to be looked at.”
Freeze welcomed by whisky association
The Scotch Whisky Association (SWA) has welcomed the duty freeze.
Chief executive Karen Betts, said it showed the UK government wants to “support one of Scotland’s most important industries”.
However she said spirits were still taxed more than beer and wine.
Ms Betts said the organisation would look at the proposed reforms.
She said they would be looking at whether distilleries had to continue operating at a “competitive disadvantage” to other alcoholic drinks producers.
She said: “By freezing duty, the Chancellor given welcome relief to all distillers, specifically in Scotland where 92% of all UK spirits are produced or bottled.
“It’s confirmation that the UK government wants to support one of Scotland’s most important industries and will take action to protect jobs, investment and exports, and to bolster the recovery in hospitality and tourism.
“The UK government must go further if it’s to meet its promise to ensure the tax system is supporting Scotch Whisky.
“Despite the duty freeze, spirits are still taxed more than beer, wine and cider.
“We will now want to scrutinise the reform proposals announced by the Chancellor today.”
She added: “At first glance, it appears Scotch whisky will continue to be put at a competitive disadvantage against beer and cider through the tax system.
Duty freeze
In the budget statement, the Chancellor confirmed that all duty rates on alcohol would remain unchanged.
Mr Sunak pledged the “biggest cut to cider duty since 1923, the biggest cut to fruit ciders in a generation, the biggest cut to beer duty for 50 years”.
The duty rate on spirits continues to be £28.74 per litre of pure alcohol.
That means of the £15.01 average price of a bottle of Scotch Whisky, £10.55 is collected in tax through duty and VAT.
SWA said spirits, including Scotch whisky, continue to be taxed more per unit of alcohol than beer, cider and wine.