Rachel Reeves issuedwarning after ‘catastrophic’ tax raid sparks disaster | Politics | News | EUROtoday

The Treasury’s tax raid on distillers has left each the nation and Britain’s whisky and spirits sector worse off, Chancellor Rachel Reeves has been warned. The business has despatched out an SOS, warning {that a} “catastrophic” 17% hike in spirits responsibility over the past three years has led to a £94million fall in tax revenues in 2025-26. Labour MP Carolyn Harris, who chairs the all-party parliamentary group for UK Spirits, warned Britain dangers “taxing the spirits sector into oblivion”. She mentioned the responsibility will increase have “led to the Treasury losing money”, which is “exactly the opposite of what was intended, and it is time to change course”.

Distillers and MPs from throughout Britain are pleading for change to stop additional hurt to the sector, stating that revenues are £ 1.1 billion decrease than anticipated when a brand new alcohol responsibility system was launched in 2023. Braden Saunders, the founding father of the Doghouse Distillery in Battersea, London, warned that the UK capital has “one of the most exciting spirits scenes in the world” however “that success story is slowly being written off”.

He mentioned the autumn in revenues ought to be a “moment of reckoning”, including: “The Government has the opportunity to look at the evidence clearly and acknowledge that the current approach simply isn’t working for anyone.”

Trade our bodies together with the UK Spirits Alliance, the Scotch Whisky Association, the English Whisky Guild and the Gin Guild have issued a joint warning, saying it’s “critical” the Treasury doesn’t ”flip a blind eye” to the affect of a “punitive and distortive duty rate” which has resulted in “job losses and investment pauses”.

They state: “Spirits duty amounts to a super tax on the industry and must be urgently addressed. Pubs and the wider hospitality industry cannot survive on beer alone, yet hard-pressed consumers are being forced to pay over the odds to responsibly enjoy premium spirits, which underpin the profitability of many bars, pubs and restaurants.”

Conservative MP Joe Robertson mentioned: “I’ve met with proud business owners who have told me that, under the current duty system, their success is being totally undermined. Revenues falling should be a wake-up call to all.”

Wendy Chamberlain, a Liberal Democrat MP who chairs the all-party parliamentary group for Scotch Whisky, mentioned: “This year’s promised review of the alcohol duty system is an opportunity to address the root of that Treasury shortfall, to ensure that spirits are not discriminated against compared to other categories of alcohol, and to support Scotch Whisky producers in their home market.”

Shadow Chancellor Sir Mel Stride mentioned: “Rachel Reeves’ tax rises are crippling our economy, damaging growth and leaving everyone worse off. You can’t tax your way to growth.”

A Treasury spokesperson mentioned: “We have kept alcohol duty rates steady in real terms to support public health and the public finances. The Office for Budget Responsibility’s latest forecast expects alcohol duty receipts to increase.”

The Treasury argues there are a number of doable causes for falling alcohol consumption, together with “increased moderation among consumers”.