Award-Winning Gin Distillery to Close Doors, Citing UK’s Escalating Alcohol Duty Rates as the ‘Final Straw’

Well-loved craft gin producer Papillon Dartmoor Distillery announces it will be closing at the end of next month. (Photo: Papillon Dartmoor Distillery)

Award-winning British craft gin producer Papillon Dartmoor Distillery has announced it will permanently close its doors on March 31. As reported by The Spirits Business, the decision was linked to the impact of the U.K.’s rising alcohol duty rates, which proved to be the proverbial “final straw.”

Announcing the decision on social media, Papillon Dartmoor Distillery extended gratitude to its many supporters while highlighting the additional challenges it has faced in recent years.

“At Easter we will be ‘calling time’ at Papillon,” the firm’s owners, Adam and Claire Hyne wrote on Instagram. “We have enjoyed distilling delicious gin for you over the past 6 years, however, we need to achieve a better work/life balance.”

“It’s been a roller coaster ride full of fun times and more challenging ones; the Covid years, cost of living crisis, rise in fuel costs, hike in prices of all supplies. The increase in alcohol duty rates last year was the final straw for this small spirits business.”

“Thank you to everyone who has supported us. It has been much appreciated. So, you have one month to stock up on your favourite Papillon products from your local retailers or online.”

“See you on the moor!”

Papillon Dartmoor Distillery, the first distillery in Dartmoor National Park, is a B Corp-certified business. Named after an endangered Dartmoor butterfly that feeds on wild violets, the company donates 1% of all bottle sales to local butterfly conservation initiatives. Its flagship Papillon Gin features 17 botanicals, including Dartmoor fresh gorse flowers, rowan and hawthorn berries, chamomile and Devon violet leaves.

The U.K. government’s decision on Aug. 1, 2023, to raise alcohol duty in line with inflation resulted in a 10.1% hike. With a survey revealing that 61% of distillers expressed the need to reduce production due to financial strains, the U.K. Spirits Alliance (UKSA) issued an open letter to Treasury Chancellor Jeremy Hunt in November, urging for a tax freeze on spirits.

The Spirits Business reported that the letter urged the Chancellor to be fair since the current initiative gives preference to freezing duties on draft beers and ciders.

“The Brexit Pubs Guarantee not only does little to support pubs, bars and restaurants but also penalizes adult customers who might prefer a gin and tonic, or a Spritz over a beer or a cider,” the letter asserted.

Another survey conducted on distillers revealed that 54% had not fully recovered to pre-pandemic revenue levels, with 40% experiencing a decrease in sales. Additionally, half of the distillers anticipated a negative impact on their hiring rates due to higher tax rates. Neema Rai, an owner of two venues, argued that the increased duty could “kill off the renaissance in British spirits and send pubs and bars back to the uninspiring days of the ’80s.”

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