Last reviewed 9 June 2021

A major boost for Scotch whisky producers could be part of a UK-Australia trade agreement with the removal of a 5% tariff on whisky exports, the Department for International Trade (DIT) has revealed.

International Trade Secretary Liz Truss is seeking to remove the tariff, which makes it more expensive for distilleries to sell overseas and is also pushing for improved legal protection for whisky in the Australian market during ongoing trade negotiations.

Australia is the eighth biggest market for Scotch whisky exports, worth £113 million last year. The Scotch Whisky Association (SWA) believes a tariff cut will help boost sales and support distillers across Scotland given that Australia is a prime market for premium single malt Scotch.

Minister for Exports, Graham Stuart, said: “From whisky to shortbread, Scotland offers an array of food and drink that many can enjoy and, thanks to the imminent UK-Australia trade deal, more people than ever will be able to do just that.”

Any agreement would also be an important gateway for Scottish businesses into the wider Asia-Pacific free trade area, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which cuts tariffs on 95% of goods traded between members.

The CPTPP is a trade bloc worth £8.4 trillion in GDP and including Australia, Canada, Japan, New Zealand and Vietnam, that UK wants to join later this year.

Scotland sold £12.5 million worth of medicinal and pharmaceutical products to Australia in 2020, despite tariffs of up to 5%.

A UK-Australia deal could increase exports by slashing those tariffs, cutting red tape and aligning regulations. Scottish machinery and tractors could also benefit from a tariff reduction of up to 5%.