Treasury admits taxing problem

Strip stamps on whisky bottles could become targets for theft

The Treasury has conceded real security concerns need to be addressed before the controversial strip stamps can be added to Scottish whisky bottles.

In his Budget, Chancellor Gordon Brown said he would put the tax stamps on whisky in a bid to cut duty fraud.

But whisky chiefs fear the stamps could be forged and become a target for theft and have admitted whisky plant security would be a major issue in the future.

It remains unclear whether the Treasury or the industry will foot the bill.

Tax savings

The legislation to bring in the stamps will shortly begin its journey through the Westminster parliament as part of a finance bill.

Ministers estimate the move will save the Exchequer about £160m a year in lost duty and plan to implement it in 2006.

Economic secretary to the Treasury John Healey conceded the security fears.

He said his department recognises security at bottling plants, and its associated costs will have to be looked at.

However, ministers refused to confirm whether they will pay for the improvements or hand out direct financial aid to improve security surrounding whisky operations.

But they said they plan to work with the industry to make the stamps a success.

The Scotch Whisky Association fought hard to stop the strip stamps being introduced.

They claim the tax stamps will harm their industry, putting jobs at risk because it will prove so costly to implement.