Scotch whisky generates almost £5billion a year for the UK economy according to new research commissioned by an industry body.
The study, carried out for the Scotch Whisky Association (SWA) found the industry supports more than 40,000 jobs in Britain, including 7,000 in rural areas.
Publishing the findings, the SWA called on the government to address the “high and unfair level of taxation distillers face in their home market,” with a 2% cut in spirits excise duty.
According to the report, whisky was the biggest net contributor to the UK’s trade in goods in 2015.
The study said: “The Scotch whisky sector directly contributes over £3.2billion to the Scottish economy. When indirect and induced effects are taken into consideration, the industry’s impact is £4.7billion.
“The industry is rooted in Scotland, but benefits from a closely related supply chain in the rest of the UK.
“When the rest of the UK is taken into account, a further £268million is injected into the economy, leading to a UK-wide impact of more than £4.9billion.”
More than 10,500 people are directly employed in the industry in Scotland, generating almost £1.3billion in salaries, according to the report. UK-wide employment associated with Scotch is just below 40,200, which is a marginal increase on previous years.
The study found that the sector is the largest net exporter of any British industry. Overseas sales of whisky are worth £3.9billion each year, while imports in the supply chain, such as packaging for products and casks total £200million, giving a trade balance of £3.7billion.
The SWA said the research reinforces whisky’s position as a “strategically important industry for the UK in terms of value it adds to the economy, jobs supported, investment and export performance, and should be supported by government.”
But, the organisation believes uncertainty created by Brexit means that the industry needs more reassurance that it will receive “fair treatment” from government.
Acting SWA chief executive Julie Hesketh-Laird said: “Without valuable Scotch exports of around £4 billion a year, the UK’s trade deficit in goods would be 3% larger and our research emphasises the value of the industry which adds £5bn to the economy annually and supports more than 40,000 jobs.”
She added: “The current tax of 77% on an average priced bottle of Scotch is a burden on consumers and the industry. And the government’s own figures indicate that fairer tax treatment leads to increased revenue for the public purse.
“We are calling on the UK Government to cut excise by 2% in next month’s Budget, supporting a great Scottish and British industry at a time of uncertainty, giving us a stronger domestic platform from which to invest and grow to make a success of Brexit.”
Figures released earlier this week showed exports of whisky generated £2.8billion between January and September last year.
Responding to the SWA’s call, a Treasury spokesman said: “Scotch Whisky is a great British success story with exports worth £4bn a year. That’s why we froze the duty on whisky and other spirits at last year’s Budget.”
