Almost a third of Scots voters say they would be less likely to support the Conservatives if the Chancellor raises the duty on Scotch whisky.
Jeremy Hunt will use his budget on Wednesday to finalise a review of the system but reports suggest producers will get nothing – and could even see tax rates increase.
He has been urged to freeze duty to fulfil the pledge made by the Tories in 2019 to “ensure our tax system is supporting Scottish whisky”.
New polling, seen exclusively by us, shows 72% of people support freezing tax on spirits in this week’s budget.
Almost 32% of 1,034 Scots polled said they would be less likely to support the Conservatives at the next general election if the duty is raised.
Just short of 13% said it would make them more likely to support the party, while around the same number said they don’t know.
Around 43% said it would make no difference.
Waiting for promises to be kept
The poll, conducted by Survation, also shows whisky’s role in supporting the wider supply chain, with 76% believing support for the industry will boost hospitality businesses.
Mark Kent, chief executive of the Scotch Whisky Association, said: “Distillers across Scotland are waiting for the pledge made in 2019 to be fulfilled.
“There has been a review of alcohol taxation but still Scotch Whisky is taxed more than beer, wine or cider – and 99% of distillers do not have access to tax breaks available to sales in the on-trade.
“The competitive disadvantage faced by the industry could get worse if the Chancellor further raises tax on Scotch whisky and other spirits in the budget this week.
“We urge him to listen to people across Scotland, make good on the commitment to support Scotch whisky, and freeze duty.”
Why are producers concerned?
The duty paid on spirits in the UK is already significantly higher than the European average, with around £3 in every £4 spent on a bottle of whisky going to the Treasury.
Spirits like Scotch account for 34% of sales in the UK on-trade, but 99% of distillers do not have access to proposed tax breaks in pubs and bars, known as “draught relief.”
The Scotch Whisky Association says a further increase would add to the cost of living and fuel inflation – which the UK government has pledged to halve this year.
It argues it would also disproportionately impact business in Scotland because it produces more than 90% of all UK spirits.