Whisky-Wealth-Club-Scotch-brochure 2020 March - Flipbook - Page 15
Why Scottish whisky?
Case Study
Whisky has been mentioned in the
Knight Frank Luxury Investment Index.
Knight Frank includes
whisky as an investment in
its index, along with classic
cars, wine, diamonds, coins
and stamps. In 2018, whisky
ranked second in the index,
only behind art in terms
of sales. This was helped
by a new world record
price set for a bottle of rare
single malt scotch whisky.
The Michael Dillon handpainted bottle of Macallan
1926 was sold by Christies
for $1.5 million USD. 11
Purchasing cask whisky is
often compared to investing
in wine, although the two
are very different. With
wine, the specific year
matters, the grapes need
to have the right amount
of sun and rain at the
right times. Whereas with
whisky, Father Time usually
casts the deciding vote.
While the quality of barley,
malt and water as well as
the distiller’s technique
along with the wood the
whisky matures in play a
crucial part in deciding the
whisky’s outcome - the
main indicator in whisky’s
value is its maturity.
The surge in median
price of single malts has
been most evident in the
US, Scotch whisky’s biggest
export market. 13
According to the Distilled
Spirits Council of the US, in
2018, 9.5 million nine-litre
cases of Scotch were sold
in the US, generating $2.3
billion USD in revenue
for distillers. 14
The Whisky Stats annual
report (published March
2018) 12 shows the growth
of aged whisky in value by
looking at specific vintage
classes, including those
with no age statement
(NAS), and the median
price of bottles sold.
Scotch continues to
demonstrate stable growth
beyond the US, growing in
double digits in key markets
such as India, Mexico, UAE
and Singapore, 15 thanks
to growing demand for
luxury goods and whisky’s
unparalleled reputation for
quality, provenance and
authenticity.
Median Price
(EUR)
800
600
400
Scotch whisky
export destinations
by value (2018)
United States
£1,039.5m +£117.8m
+12.8% (£921.7m in 2017)
Singapore
£319.9m +£29.2m
+10.0% (£290.7m in 2017)
UAE
£146.9m +£17.1m
+13.2% (£129.8m in 2017)
India
£138.8m +£35.3m
+34.1% (£103.5m in 2017)
Mexico
£131.5m +£20.5m
+18.5% (£111.1m in 2017)
Tax
advantages
Investing in scotch may
have tax advantages for
investors. Whisky may be
deemed a wasting chattel (its
useful life does not exceed
50 years), therefore the
ABV% of the spirit going into
the barrel may influence tax
considerations. Spirit going
into barrel at 78% to 90% ABV
will last 50 years, as opposed
to spirit going into cask at
63% to 68% ABV which may
not last 50 years.
It is worth noting that some
commentators suggest any
profits made on whisky sales
that exceed limits set out by
HMRC, may be subject to
capital gains tax.
200
2013
2014
>30 yo
20-30 yo
2015
15-20 yo
2016
10-15 yo
2017
