Rachel Reeves has been warned she is ‘crushing’ gin distilleries and hurting the pub trade as a duty hike takes effect today.
Higher taxes mean that a ‘golden era’ of British gin-making could be over, according to the UK Spirits Alliance (UKSA) – which represents 300 liquor producers .
In a letter to the Chancellor, the group said: ‘Other countries protect, support and promote their iconic products while our sector feels it’s been hit by all sides in recent years.’
From today, the duty paid will rise by 3.6 per cent, which means the tax on a typical bottle of gin will rise by 32p. There was a 10.1 per cent increase in 2023 under the Tory government.
The UKSA said the rate of tax – the highest in Europe – on spirits is placing extra stress on businesses as they struggle with higher costs.
Up to 70 per cent of the price of a bottle of liquor is taken as tax, including duty and VAT.
There are fears some bottles could disappear from UK shelves altogether and many more pubs will be forced to shut or pass on higher prices. Duty on beer, meanwhile, is being cut by 1p a pint.
In the letter, the UKSA said: ‘Meanwhile, spirits drinkers are being priced out of pubs and bars, while lager drinkers are being subsided.
‘Instead of celebrating an iconic British success story, you are in danger of crushing it.’
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