UK Chancellor continues duty freeze on spirits

UK Chancellor Philip Hammond has decided to continue to freeze spirits duty.

Announced as part of the latest government budget, the decision will save British consumers £0.02 on a pint of beer, £0.01 on a pint of cider, and £0.30 on a bottle of Scotch or gin.

The duty rate on spirits will be unchanged and remain at £28.74 per litre for pure alcohol. This will mean around £10.41 of an average bottle of Scotch whisky will be collected in tax under VAT and excise duty.

Many drinks groups in the UK, including the Scotch Whisky Association (SWA), have welcomed the decision.

SWA’s CEO Karen Betts said: “The Chancellor has made the right decision for the public finances, the industry and for consumers.

“The continuation of the duty freeze is a very welcome show of support for the Scotch Whisky industry, which plays an important role in the UK and Scottish economies and is one of the UK’s most successful exporters.

“Time after time, the industry has shown that a stable rate of tax both boosts government revenue to help support vital public services and creates an environment which encourages investment in future growth.”

However, Hammond also announced that there will be a usual retail price index (RPI) increase on wine.

The Wine and Spirit Trade Association (WSTA) noted that this increase of duty will mean that a bottle of wine will increase by £0.07, while sparkling wine and fortified wine will also rise by £0.09. In addition, VAT will add a further 20% to the wine duty rise.

Earlier this month, WSTA submitted a letter to Chancellor Philip Hammond and environment secretary Michael Gove urging a freeze on wine duty.