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Finance Bill

It is quite obvious that these constant increases in duty will deter investment in the industry, and that will clearly have an effect on employment. One illogical aspect of the present system is that spirits are taxed far more heavily per unit of alcohol that beers or wines. If alcohol were taxed on health grounds, surely the only logical way to tax it would be based on the units. The present Prime Minister, when he was Chancellor, had the policy of freezing the duty on spirits and allowing that on beers and wines to catch up. I am disappointed that that policy has not continued. Various studies over the years have shown that the sale of spirits is very sensitive to price—far more so than is the case with wine. A policy of reducing the tax on spirits and increasing that on wine to a comparable level would probably bring in more money for the Treasury. Scotch whisky is the world's leading spirit drink. It can be produced only in Scotland, but it relies heavily on products produced throughout the whole of the UK. It is therefore bizarre that a product that is so important to the UK economy is taxed much more heavily than wines, most of which are imported. I doubt that any other country in the world discriminates against one of its own products in favour of imports in such a way. An unfortunate side effect of that is that it encourages other countries to impose unfair duties on Scotch whisky.