ALISTER Jack has said he “regrets” his lobbying attempts against the alcohol duty increase failed in the face of criticism from the whisky industry.
On Wednesday, the chancellor confirmed in his spring Budget that duties on all alcohol would “go up in line with inflation in the usual way” after the current freeze ends on August 1.
The whisky industry described the rise as a "historic blow" that was “deeply disappointing”.
The Scottish Whisky Association (SWA) added that bosses told the government that the 10.1% increase was "the wrong decision at the wrong time".
The Scottish Secretary was asked if he wanted to apologise to the sector and replied, “it’s not what I wanted for the Scottish industry”.
Jack said: "Did I lobby against it? Yes, I did. Did I lobby against it the last few years successfully? Yes, but this time the lobbying hasn't been successful.
"I understand that the industry will be upset to see duty increase".
He described the whisky industry as a "buoyant" one and said the Westminster government was working hard to get additional trade deals and increase exports.
The SWA said the rise in duty would mean taxes will account for 75% of the cost of an average-priced bottle of whisky. A bottle costing £15.22 will see £11.40 go to the taxman, through duty and VAT.
Mark Kent, SWA chief executive said tax breaks for drinks sold on draught will “further increase the competitive disadvantage faced by the industry”, saying these would not be available to the “vast majority” of distilleries.
The only exception to the hike in alcohol will be for drinks sold on draught in pubs, where from August the duty charged will be up to 11p lower than it is on products sold in supermarkets.
SNP MSP Richard Lochhead had expressed concerns over reports earlier in the week of a possible increase in duty despite that fact that around £3 in every £4 spent on Scotch whisky already goes to the Treasury.
Lochhead said: "Distillers have been clear that they need the Chancellor to back the industry when he delivers his budget in the Commons.
"With £3 out of every £4 spent on whisky going to the Treasury the industry is already at a competitive disadvantage to other producers.
"That will only get worse if the Chancellor hikes tax on whisky."
Liberal Democrat Scottish affairs spokesperson Christine Jardine, meanwhile, branded the tax hike as being “terrible news for one of Scotland’s most iconic products”.
Jardine added that “distillers are being hung out to dry” by a chancellor who is “whacking up tax”.
Scotland Office minister Lord Offord said on Wednesday that while he could “understand the Scotch whisky industry is upset with a 10% hike”, he said the sector had benefited from “nine out of the last ten budgets being a freeze”.
