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Scotch whisky industry seeks business support clarity

The Scotch Whisky Association has welcomed the unprecedented government support to business announced last week.

The announcement, as a result of the disruption being caused across the economy by COVID-19, offers significant reassurance to Scotch whisky businesses.

However, the industry is also seeking urgent assurances from Ministers on aspects of the support package, including whether business rates relief will apply where distilling, retail and hospitality sites are co-located, and on the deferment of duty payments.

Scotch whisky distillery visitor centres have closed in line with government advice, but it is not currently possible for visitor centres, cafes and other hospitality and retail units located at distilleries to qualify for the relief.

In addition, the SWA has called for the suspension of duty payments – due on Wednesday 25 March – for a period of at least six months. This is critical to cash flow in Scotch Whisky businesses and will help producers continue to stay afloat and support their supply chain.

The SWA is also in discussions with government and other authorities about how Scotch Whisky companies can contribute to the production of hand-sanitiser during the coronavirus crisis. The industry is very willing to offer support where it can to health services, emergency services and communities in an effective and coordinated way.

Karen Betts, SWA chief executive, said: ‘The support measures set out by the UK and Scottish governments, covering business rate relief, access to loans and a safety net for employees, is hugely welcome and offers important reassurance to Scotch Whisky producers, large and small.

‘However, we still need clarity on some aspects of the support. Business rates relief is key for distilleries which also run visitor centres, shops and cafes which have had to close, but it’s not clear that they will qualify under the terms announced. We’re asking the Scottish Government for urgent clarification.

‘We are also asking for the payment of excise duty to government to be deferred for at least six months. Payment is due this week, and deferring will support distillers’ cash flow and give them much-needed breathing space at a time when hospitality and exports are hugely impacted globally. It will also help distillers to support the companies that supply them, many of which are small businesses at the heart of Scotland’s rural economy.

‘The industry is also offering to help the country to tackle COVID-19 where we can. We think we can help in boosting supplies of hand sanitiser where it is needed by frontline health and social care services across the UK, in food manufacturing and in the provision of local services.

‘We are working urgently with both UK and Scottish Governments to address the regulatory issues to enable this to happen as well as to help us work supportively with existing producers.’