The Scottish government is on a collision course with the alcohol industry again, just weeks after the European courts delivered a seemingly fatal blow to its plans for minimum pricing.
Under the latest proposals, Nicola Sturgeon’s government is considering hitting retailers with a new “social responsibility levy” for selling alcohol, which industry leaders described as a “naked tax grab”.
The levy was originally devised as part of the Scottish proposals for MUP, amid fears retailers could pocket a £100m windfall because of hiked alcohol prices.
Those plans suffered a major setback earlier this month when EU advocate general Yves Bot said the government had failed to explain how minimum pricing would be a fairer solution than taxation.
However, last week deputy first minister John Swinney told Holyrood it was now considering pressing ahead with the levy, which already has regulation in place paving the way, regardless of the fate of MUP in the EU and Scottish courts.
It has caused uproar from the industry, coming just months after the end of the previous health levy in Scotland, which was branded the ‘Tesco Tax’. It finished in March, having hit supermarkets with a £95m addition to their rates bill over the previous three years, which resulted in a 28% increase in rates bills for supermarkets and is estimated to have cost Tesco alone more than £16m.
Industry leaders predicted the new levy could be even bigger. WSTA chief executive Miles Beale described the plans as a “sledgehammer to crack a nut”. “We don’t believe that an additional fee on top of an existing local authority licence fee would be an effective way of tackling alcohol-related harm,” he said. “This would be a blanket tax passed on to everyday shoppers. It would damage responsible retailers, and have a negative effect on jobs and growth in Scotland.”
“There’s no evidence the Tesco Tax was used for health purposes,” said David Martin, head of policy and external affairs at the Scottish Retail Consortium. “It was a naked tax grab and this looks like more of the same.”