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Slàinte: Raising a dram to the success of Scotch

Did you know that whisky is the UK’s biggest food and drink export, making up a quarter of the entire market?

That’s worth a toast any time of the year.

Exports are now worth more than £6 billion annually, directly supporting 11,000 jobs here in Scotland – many in rural parts of the country.

And the sector also makes a huge contribution to our appeal as a tourist destination, bringing in billions of pounds for our economy.

Thank you to everyone involved in this extraordinary global success story.

A UK-wide effort

By definition, of course, Scotch can only be produced here in Scotland.

And we undoubtedly make the best whisky anywhere in the world.

But the success of the sector relies on more than just the amazing distilleries in Speyside, Highlands, Islay and elsewhere.

It’s a true joined-up effort.

The industry is a vital part of the Leven economy in Fife, for example, where Diageo has a large bottling plant.

And while whisky itself is made from three simple ingredients - water, yeast and cereals – there’s a lot more to the finished product than that.

There’s packaging from Wales, yeast from Staffordshire, glass from Yorkshire and logistics from Essex.

It’s a UK-wide effort, supporting an additional 42,000 supply chain jobs right across the United Kingdom.

And, of course, whisky is not just enjoyed abroad – it’s one of our most popular drinks in England, Scotland and Wales as well, where trade flows freely through our single market.

Selling whisky to the world

Around 53 bottles of Scotch are shipped every second to 180 global markets.

A huge effort has gone into this vital export success, involving whisky makers and successive UK governments.

Promoting whisky to foreign markets is a key role for the Department for International Trade, and its predecessor departments, which works with the UK’s worldwide network of embassies to bring Scotch to new and emerging markets.

These new markets are where much of the exports growth comes from.

With 200 embassies around the world, the soft power of the UK is vital to Scotland’s economic success.

Maintaining economic certainty

Like any big industry, the whisky sector needs economic certainty.

Whatever you think of Brexit, there is no doubt that the upheaval of leaving the EU has affected the market.

The new shipping and customs regulations for Scottish distillers to contend with were a headache – just imagine replicating that at the border with England, where millions of whisky bottles flow south.

And while Brexit may have been problematic for industry, business weren’t contending with a switch to entire new currency, untested on the world markets.

Yet the SNP not only wants to build a hard border with England, it wants to scrap the pound too.

The very last thing that Scottish employers need is that kind of devastating uncertainty.

It’s no surprise that an open letter to The Scotsman claiming the case for independence had not been made in 2014 was signed by 130 business leaders including from William Grant & Sons, the Edrington Group and Ian Macleod Distillers.

The latest figures show that our entire trade with the rest of the UK of £52 billion amounted to 60 per cent of all Scotland’s exports.

In contrast, the entire EU accounted for only 19 per cent (£16.4billion), while non-EU exports made up 21 per cent (£18.7billion).

These figures conclusively demonstrate the vital importance of remaining part of the UK.

Scotching the myths

Sadly, some in the nationalist movement continue to spread myths about our amazing whisky sector, with false claims about a ‘whisky export duty’.

Exports, including exports of whisky, do not attract duty in the UK. That should be obvious.

But don’t just take our word for it – the Scottish Government’s own annual publication, Government Revenue and Expenditure Scotland (GERS), explains the reality.

“Like any industry, the whisky industry’s activity in Scotland generates tax revenue through a range of sources, such as corporation tax on profits, income tax and national insurance contributions on staff earnings, and non-domestic rates payments on business premises.

“These are all captured in the estimates of Scottish public sector receipts reported in GERS.

“In addition, whisky consumed in the UK is subject to VAT and alcohol duty. This is assigned to Scotland on the basis of how much is consumed in Scotland. Whisky which is exported does not generate UK VAT or alcohol duty. There is no export duty in the UK.”

So next time you hear a nationalist spouting a myth, tell them the truth.

The fantastic success of Scotch is included in Scotland’s annual accounts.

And what do those accounts tell us?

That public expenditure per person in Scotland on public services was £2,217 higher than the UK average.

As part of the UK we can therefore spend more on vital public services.

Now that’s worth raising a dram to!


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