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Alcohol Duty

25 February 2021

Lead MP

Douglas Ross

Debate Type

Adjournment Debate

Tags

NHSEconomyTaxationCulture, Media & SportBusiness & Trade
Other Contributors: 1

At a Glance

Douglas Ross raised concerns about alcohol duty in the House of Commons. A government minister responded. Other MPs also contributed.

How the Debate Unfolded

MPs spoke in turn to share their views and ask questions. Here's what each person said:

Lead Contributor

Opened the debate
Douglas Ross, MP for Moray, emphasised the need to deliver a competitive duty system for alcohol producers in the UK, particularly focusing on supporting Scotland’s national drink, Scotch whisky. He highlighted that since his election in 2017, the UK Treasury has frozen the duty on spirits at every Budget, which has been well received by the sector. However, Ross pointed out that over £3 of every £4 spent on a bottle of whisky is tax, one of the highest rates among alcoholic beverages globally. He welcomed the Conservative party's commitment in its 2019 manifesto to review alcohol duty to support British drink producers and praised the Prime Minister’s announcement during his election campaign.

Ross argued that now is an opportunity for the UK Government to redress historical injustices in the alcohol duty system, using it not just as a revenue-raiser but also as a tool to back domestic producers. The Scotch whisky sector employs 11,000 people and supports over 40,000 jobs across the UK, contributing £5.5 billion annually. He noted that the industry has faced significant challenges due to the pandemic, including lost tourism income and business closures.

Ross also mentioned the impact of the 25% US tariff on Scotch whisky exports, estimated at a loss of £500 million. Acknowledging the contributions of smaller producers like craft brewers and gin distillers, he called for changes to support these sectors in the upcoming Budget and beyond. He urged the Government to set out clear timetables for reforming the alcohol duty system.

Government Response

NHSEconomyTaxationCulture, Media & SportBusiness & Trade
Government Response
John Glen acknowledged the importance of the debate on the future of the UK’s alcohol duty system, noting that it has a long and fascinating history dating back to 1643. He emphasised the Government's pragmatic approach to duty levels, with seven out of eight Budgets seeing cuts or freezes in spirits duty since 2014. Glen highlighted that the current system raises over £12 billion annually for public services such as the NHS. Since the announcement at the 2020 budget about reviewing alcohol duty, officials have engaged extensively with stakeholders across the industry, receiving more than 100 submissions expressing a wide range of views. The Government are analysing these responses and will provide updates from the review in due course. Glen also mentioned a separate technical consultation on small brewers' relief that closes on April 4th. Regarding the US tariffs on Scotch whisky, Glen agreed they are disappointing and unfair but assured that negotiations with both the US and EU remain ongoing to reach a fair settlement. He reiterated the Government's commitment to support the drinks industry for the long term, aiming to challenge existing anomalies and reduce inconsistencies in the market.
Assessment & feedback
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About House of Commons Debates

House of Commons debates take place in the main chamber of the House of Commons. These debates cover a wide range of topics including government policy, legislation, and current affairs. MPs from all parties can participate, question ministers, and hold the government accountable for its decisions.