The Scotch Whisky Association said new tax receipts data published by HMRC show the UK Treasury has lost £298 million in tax revenue from Scotch Whisky and other spirits since former UK finance minister Jeremy Hunt’s record-breaking tax hike last August.

Figures for August 1, 2023, to July 31, 2024, show excise duty from spirits generated £3.951 billion for the UK public finances – compared to £4.249 billion in the same period the previous year – a loss of £298 million.

The Scotch Whisky Association said Hunt increased excise duty by 10.1% from August 1, 2023 – the biggest such tax hike in more than four decades.

It said the UK has the highest level of excise duty on Scotch of the G7 countries and the fourth highest in Europe – double that of France and quadruple the excise duty of the United States.

The Scotch Whisky Association said it has urged new UK finance minister Rachel Reeves “to reverse the economic damage caused by her predecessor” in the Budget on October 30.

It said nearly 70% of the cost of a bottle of Scotch in the UK is currently claimed in tax.

Scotch Whisky generates £7.1 billion a year for the UK economy and is the UK’s number one food and drink export.

The Office for National Statistics concluded that Hunt’s duty increase resulted in the largest contribution to inflation by alcohol on record.

Analysis on behalf of the Scotch Whisky Association has found that the tax rise made a 0.35% contribution to inflation – resulting in £2.3 billion in extra government interest payments on public borrowing.

Scotch Whisky Association CEO Mark Kent said: “The Treasury has now lost more than a quarter of a billion pounds because of the previous Chancellor’s decision to increase tax on Scotch Whisky and other spirits.

“It has been a calamitous decision, which has cost the Treasury money that could have been used for public services. It has stoked inflation, and it has hurt business, hospitality and households.

“We urge the Chancellor to use the Budget to reverse the economic damage caused by her predecessor and deliver on the Prime Minister’s commitment to back Scotch Whisky distillers to the hilt, and in turn boost growth in Scotland.”