Why remaining in the EU is just the tonic for the gin industry

HM Treasury

May 12
12:31 2016

The UK exported 30 million bottles of gin to the EU last year, making up 45% of total gin exports by value. On the visit to Beefeater today (12th May), Exchequer Secretary Damian Hinds was told by spirit industry leaders that this number may fall if the UK leaves the European Union.

Industry leaders who met the Exchequer Secretary warned that losing access to the EU single market, which makes overseas trade far easier for highly regulated industries such as alcohol, could mean that UK producers wont be able to trade as freely due to the loss of EU common standards.

A recent survey carried out by the Wine and Spirit Trade Association (WSTA) found that the UK wine and spirit trade will be stronger if Britain remained in the European Union. As part of a consultation of its 300 plus members this message was endorsed by 90% of those who responded.

Exchequer Secretary to the Treasury, Damian Hinds said:

The UKs gin industry is undergoing a remarkable renaissance with the rest of the world developing a taste for our world-leading gin. The message from industry voices and famous gin makers like Beefeater is clear; leaving the EU would hit exports hard and could apply the brakes to the gin boom. I believe that gin like the rest of our spirits industry will be stronger, safer and better off within a reformed EU.

Miles Beale, Chief Executive of the Wine and Spirit Trade Association said: >> The great tradition of British gin making is supported by remaining in Europe - for both exporting and quality reasons. Exports of gin have risen by 46% in the past five years, with sales to 139 countries, worth 2.18 billion over that period. In 2015 alone the UK exported 231 million worth of gin to non EU countries and an impressive 189 million to consumers inside the EUs single market.>> Without the benefit of the quality standards underpinned by the European definition of gin our producers and their brands could find themselves with fewer consumers, fewer trading partners and a less glowing global reputation.

Laurent Lacassagne, Chairman & CEO of Chivas Brothers, owner of Beefeater gin said:

While this is clearly a decision that will be and should be made by the UK public, Chivas Brothers believes that being part of the EU supports the continued success and future of spirits made in and exported from the UK like gin and Scotch whisky.

The EUs single market, such as its regulation of food and drink, combined with its single trade policy, are vital to our industry and our brands. The result is fair access to markets, which in turn supports jobs, growth and the industry in the long-term.

During his visit Mr Hinds toured the distillery and saw how the historic Beefeater gin is made. According to the WSTA a total of 1.6 billion gin and tonics were sold globally in 2014 and almost 140 million bottles of gin made in the UK are now exported every year.

Government statistics also show that between 2010 and 2015 a total of 174 new spirit distilleries opened in the UK - with 56 new licences issued in the past year alone. The number of UK gin brands has more than doubled since 2010 from 31 to 73 due to the demand for new brands.

Following the Chancellors 2% cut to spirits duty last year, duty on spirits was frozen at Budget 2016. Duty on a bottle of gin remains 7.26. The tax is 81p lower since ending the spirits duty escalator in 2014.

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