Overview: Chancellor John Healey’s Budget has confirmed a further duty increase on Scotch whisky and other spirits, prompting immediate political reaction from the Scottish National Party. The tax burden on the average bottle of Scotch whisky is projected to rise to 74%, continuing a trend where duty on spirits like whisky increased by 24% since 2023.
The Full Story
The SNP has alleged that the UK Government would not have hiked tax on Scotch whisky four times in four years if the industry was based in England. SWA chief executive Mark Kent noted there is an inherent imbalance at the heart of the current duty system, as small producers of alcoholic drinks with content below 8.5% receive tax breaks denied to small whisky distilleries. SNP MP Graham Leadbitter called on Scottish Labour MPs to vote against the tax rises in the Commons, stating they would not have been brought in if the industry was south of the Border.
What This Means
The UK Government stated that alcohol duty will be uprated in line with RPI (4.55%) on 1 February 2027 to maintain its current real-terms value. SNP MP Graham Leadbitter argued that crippling Westminster taxes are under attack and if these sectors were based south of the Border, they would never be subjected to the same treatment. The decision balances the contribution of alcohol producers with the duty’s role in reducing alcohol harm according to the Office for Budget Responsibility forecast.
Consumer Takeaway
Drinkers face a projected tax burden on the average bottle of Scotch whisky rising to 74% under the new budget resolutions. Small whisky distilleries remain denied tax breaks available to other small producers of alcoholic drinks with content below 8.5%. The duty increase is scheduled for implementation in line with RPI (4.55%) on 1 February 2027.
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