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The Chancellor should take this opportunity to support Scotch whisky and help Scottish business build back better

The Chancellor should take this opportunity to support Scotch whisky and help Scottish business build back better
4 min read

The Chancellor has the opportunity to show his support for the Scotch whisky industry in the Budget by not increasing a duty burden that already sees nearly 70 per cent of the cost of a bottle of Scotch claimed by the Exchequer.

The next few weeks will see the eyes of the world on Scotland. COP26 is a watershed moment in which the Prime Minister will continue his mission to unite the leaders of the world in the effort to tackle climate change. 

Of course, he and other members of the Cabinet have visited Scotland in recent weeks to lay the groundwork for a successful conference and showcase the important place Scotland has within the United Kingdom.

Despite the cries of the SNP, there is nothing unusual about these visits. They merely confirm this government’s commitment to Scotland and to the Union. Scotland has two governments, both of which should be pulling in one direction to benefit people across the country. Unfortunately, the SNP is more focused on pulling the country apart.

By talking about another divisive and damaging independence referendum, the First Minister and her colleagues waste precious time and energy which should be harnessed to drive forward the economic recovery from the Covid-19 pandemic.

But the First Minister will of course continue to tilt at windmills, and this provides us an opportunity to emphasise that Scotland is better within the Union – and the whole United Kingdom is enriched by Scotland being part of it.

This includes delivering for Scottish businesses. The government has a great record – with my good friend the Foreign Secretary working hard, when she was Trade Secretary, to secure a trade deal with Australia alongside the suspension of US tariffs on Scotch whisky that harmed our world-leading distilleries. To continually make the case about how we’re supporting Scottish businesses, we need to show that we’re backing distilleries that are doing their part in generating revenue, creating jobs, and investing in a more sustainable future - often in our most remote and rural communities.

Just imagine what the Scotch whisky industry can do for our economy if we take the handbrake off

In many ways, it’s remarkable that Scotch whisky producers have consistently invested, innovated and created jobs, given they are handicapped by an excise duty system that means you pay more for consuming a unit of alcohol through Scotch than you do if that unit comes in the form of a pint or a glass of wine.

Just imagine what the Scotch whisky industry can do for our economy if we take the handbrake off.

It’s been 12 months since the Treasury launched its call for evidence for a review of excise duty. The Chancellor and his officials have of course had to address the economic crisis caused by Covid-19 – and have done so heroically!

I don’t underestimate the challenge. But as we see more evidence of growth – the very thing we need as we build back better from the pandemic, we need to ensure the Budget reflects the spirit of the duty review – and continue to support Scotch whisky.

The review provides an opportunity to arrest historic structural weaknesses of our tax system, provide simplicity and common sense, and ensure it is fit for the 21st century – a long term solution whilst the appropriate short-term measures are in place to support our hospitality sector. It can deliver fairness for Scotch whisky, as the Chancellor has done in previous Budgets, which has encouraged the investment we are benefiting from today.

In the interim, the Chancellor has the opportunity to again show his support for a vital national industry in the Budget by not increasing a duty burden that already sees nearly 70 per cent of the cost of a bottle of Scotch claimed by the Exchequer.

While the SNP fight over who is in charge and at the same time demand another shot at pulling the country apart, the Conservatives have the opportunity to pull together, roll up our sleeves and get on with the job in hand. By showing our continual support for Scotch whisky, we can demonstrate how we are committed to delivering for business and for Scotland.  

 

David Duguid is the Conservative MP for Banff and Buchan.

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