An anticipated hike on alcohol duty is threatening to “kill distilleries and British culture”, the capital’s spirit producers have warned.
The UK Spirits Alliance, which represents distilleries and suppliers, is calling for a freeze on excise duty ahead if the Chancellor’s Budget later this month.
Its campaign has received backing from MPs and local pubs.
Duty on spirits increased by 3.65 per cent in Labour’s 2024 October Budget, and by 10.1 under the previous Conservative government in 2023.
The Standard reported last month that the capital’s distilleries were being crushed by existing duty and are fearful of their futures. The group now has the support of MPs Carolyn Harris and Marsha de Cordova.
Distiller Braden Saunders, founder of Doghouse Distillery in Battersea, said: “We are on our knees. Increasing excise duty just cannot happen.”
He said distilleries and pubs are facing a “triple whammy” of reduced customer spending, rising costs, and now an uptick in excise duty. He claims to know distilleries that are closing on a weekly basis.
“It will kill distilleries, and it will kill British culture. It will be a cataclysmic imposition of the entire culture that Britain was built on,” he said.
Mr Saunders has been at the helm of Doghouse Distillery since 2010, producing around 20,000 bottles of vodka, whisky and aperitivo a week.
The UK’s duty rates on alcohol are currently the highest in the G7, with around 70 per cent of the price of a bottle of gin going directly to the Exchequer, according to the UK Spirits Alliance.
Marsha de Cordova, the Labour MP for Battersea, said: "Hospitality businesses like Doghouse Distillery here in Battersea contribute a huge amount to our national economy, provide much-needed jobs and give communities their unique character.
“Battersea is home to some fantastic hospitality businesses and it’s important we take every opportunity to shine a light on their hard work and the sector’s role in building a thriving and innovative society.”
Carolyn Harris, MP for Neath and Swansea East, has also called on the Chancellor Rachel Reeves to freeze excise duty to give businesses the “stability and confidence they need to invest, expand, and take advantage of growing export opportunities across the world.”
She told the Standard that as a former barmaid, she believes that spirits should not be separated from other alcohol.
“I’m not saying we should increase beer duty – just that we should freeze spirits duty. They should all be treated the same,” she said.
As it stands, while spirits account for 33 per cent of all alcohol sales in pubs, customers pay double the tax on a measure of gin compared to an average pint, even though it contains roughly half the alcohol and half the calories.
The UK Spirits Alliance also say a hike in duty will have devastating effects on the hospitality industry.
Office for National Statistics data shows that the hospitality industry accounts for nearly half (45 per cent) of all job losses since the November 2024 Budget, with more losses expected should the Chancellor increase duty.
Neema Rai, founder of the Tamesis Dock Pub near Westminster, said: “We’ve tried to keep our prices stable, but we’re being squeezed and squeezed. If we’re forced to pass on the increases, that’s going to make it tough to stay competitive and keep investing in our pub.”
Megha Khanna, owner of the Gladstone Arms in Borough, said: “It’s time to recognise that pubs are more than just pints. We’re proud that are customers come for our great G&Ts. Cuting alcohol duty in the budget will not only help pubs and distillers grow and create wealth, but it will also raise money for the Chancellor who has a serious financial blackhole to plug.”
The cost of spirits has spiralled in recent years, with inflation on spirits doubling from 2.4 per cent a few months ago to 4.8 per cent today.
Recent receipts from HMRC show that despite the hike in duty, spirits duty revenue is falling, down £700 million in the two years since 2023 compared to the same period before duty was raised.
The Autumn 2025 Budget will be delivered on November 26.
