The spirits industry braces for a significant challenge as a 3.66% increase in excise duty on spirits takes effect today, exacerbating pressures on businesses already struggling to stay afloat.
Distillers Voice Alarm Over Economic Impact
Braden Saunders, co-founder of Doghouse Distillery in London’s Battersea, highlights the dire situation facing many operations. He states that consecutive governments have relied heavily on the sector for revenue, leaving it vulnerable. ‘Spirits and cocktails remain essential to the profitability of hospitality venues,’ Saunders explains. ‘A strong selection of spirits helps keep businesses operational.’
Greville Richards, director of Saint Sithney Distiller in Cornwall, criticizes the policy for undermining support for pubs. He notes, ‘While the government aims to aid pubs, this move targets the products that drive their success. UK spirits already face some of Europe’s highest excise duties, creating disadvantages for domestic and international competitiveness.’
Parliamentary Concerns and Calls for Reform
Joe Robertson, Conservative MP for Isle of Wight East and member of the all-party parliamentary group on UK spirits, warns of widespread repercussions. ‘This duty rise will severely affect pubs, distillers, and consumers,’ he says. ‘Distilleries support local communities through jobs, innovation, and export potential. They require stability to expand, yet face increasing burdens that also harm pubs.’
The UK Spirits Alliance urges the Chancellor to prioritize growth in the upcoming duty review. Carolyn Harris, Labour MP and chair of the all-party group, adds that the hike burdens everyday consumers. ‘People enjoying a drink after work now face extra costs,’ she observes. ‘Pub operators report spirits as key profit drivers, making this tax rise even more challenging amid existing difficulties.’
Government Justification for the Measure
A spokesperson from HM Treasury defends the increase as necessary for fiscal health. They explain, ‘Rebuilding essential public services requires such steps. Record investments in schools and the NHS aim to support children and reduce waiting times. Alcohol duties help maintain fair public finances and fund vital services that benefit everyone daily.’
