Proposal for duty rise on whisky 'tweaked'

Chancellor Alistair Darling is to change his plan for a duty increase on Scotch whisky after protests from the industry, it was revealed today.



He is expected to table official papers later today which will reduce the planned 8 per cent rise in excise duty.

Whisky producers complained that the increase, even combined with a 2.5 per cent cut in VAT, would put 29p on the price of a bottle of whisky.

The order enshrining the 8 per cent rise was published on Monday - and it noted that "no impact on the private or public sectors is foreseen".

But sources confirmed Mr Darling will today lay a further order which will ensure that the tax paid on a bottle will remain "broadly" unchanged.

The move was described as a "tweak" rather than a climbdown.

A Treasury spokesman said: "As the Chancellor has said, what he intends is to ensure that broadly what people pay in tax on whisky, or any other alcohol, is the same next week as it was last week."

The move was welcomed by the industry.

Campbell Evans, of the Scotch Whisky Association, told BBC Radio Scotland: "I am delighted that this appears to be revisited.

"I'm sure this is an error that crept in and the Government is taking quick steps to address that and the industry will welcome that very much."

The industry has been particularly critical as the rise would have been the second this year.

After Mr Darling's Pre-Budget Report on Monday, the association said: "There is no logic to any duty increase.

"Alcohol revenues have already fallen by £40 million this year on the back of the 9 per cent excise rise in March."

In broadcast interviews yesterday, Mr Darling insisted his aim was to keep alcohol taxation "broadly" the same but, while VAT was charged on price, duty was charged on alcohol content so there was not an exact match.

SNP MP Angus Robertson, whose Moray constituency is a major whisky-producing area, said: "We need to see the detail of what Alistair Darling is proposing but hopefully he is U-turning on this damaging tax hike on one of Scotland's key industries.

"It would be a huge blow to the Chancellor's credibility if he is forced into a climbdown when the ink on the Pre-Budget Report is barely dry, and it suggests that he didn't understand the impact of his own PBR measures on Scotland."



The British Beer and Pub Association contacted the Treasury to demand "fair treatment" for beer following the announcement that the duty increase on whisky is to be reduced.

Any tax changes announced for whisky and spirits should apply to the whole alcohol sector, said the Association.

It rejected Mr Darling's claim that alcohol duty increases would merely offset the temporary reduction in VAT, insisting that they will in fact result in price increases, with beer suffering the second highest overall tax rise in off-licences.





During an emergency House of Commons debate on the Pre-Budget Report, Mr Darling confirmed the duty changes to MPs.

He said: "I said on Monday that what I wanted to do was to make sure that the level of taxation on alcohol and on cigarettes remained the same so that broadly the reduction in VAT would be cancelled out by the change in duty.

"I think in relation to spirits, what we announced on Monday didn't actually achieve that.

"So I am tabling a further order today to ensure that spirits, the duty there, is at a slightly lower rate, which I think will hugely benefit the spirits industry wherever it is."

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Sales Administrator - Spanish Speaking

£17000 - £21000 per annum: Recruitment Genius: This is a fantastic opportunity...

Recruitment Genius: Sales Administrator - German Speaking

£17000 - £23000 per annum: Recruitment Genius: This is a fantastic opportunity...

Recruitment Genius: Sales Administrator - Japanese Speaking

£17000 - £23000 per annum: Recruitment Genius: If you are fluent in Japanese a...

Recruitment Genius: Graphic Designer - Immediate Start

£16000 - £25000 per annum: Recruitment Genius: This is a fantastic opportunity...

Day In a Page

Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Wimbledon 2015: Heather Watson - 'I had Serena's poster on my wall – now I'm playing her'

Heather Watson: 'I had Serena's poster on my wall – now I'm playing her'

Briton pumped up for dream meeting with world No 1
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Ashes 2015: Damien Martyn - 'England are fired up again, just like in 2005...'

Damien Martyn: 'England are fired up again, just like in 2005...'

Australian veteran of that Ashes series, believes the hosts' may become unstoppable if they win the first Test