Higher tax on beer the spirit

By MARTIN JOHNSTON

Beer and wine drinkers may face higher prices as the Government looks at rejigging liquor taxes in a bid to cut alcohol abuse.

The National Alcohol Strategy, made public yesterday, suggests a study of basing the excise tax on the volume of alcohol rather than the type of drink.

This would reduce the excise on spirits, which are now taxed at more than 50 per cent, and increase that paid on beer, wine and pre-mixed "alcopops," which are taxed at much lower rates.

The Health Ministry document also suggests: considering wider use of alcohol tests in industries where public safety is at stake; ACC-levy cuts for employers with approved policies on alcohol; more breath-testing of drivers; and a body to monitor alcohol marketing.

The strategy coincides with research showing that heavy drinking by teens is worsening, although the number of teetotallers is rising.

It aims to cut the social costs of alcohol abuse, which are estimated at up to $2.4 billion a year and include road deaths, drowning, foetal abnormalities, violence, impaired work performance and absenteeism.

The strategy notes "some have suggested" that switching the excise tax from drink type to alcohol content would be more equitable because it is the "alcohol component ... that is responsible for alcohol-related harms."

The Labour-Alliance Government risks alienating working-class voters if the price of beer goes up.

A spokesman for Finance Minister Michael Cullen said the Government had no plans to increase the tax on alcohol.

A senior Health Ministry drugs-policy analyst, Paul Marriott-Lloyd, said no work had begun to investigate the tax proposal.

"These are the sorts of things we could look at to reduce alcohol-related harm. It's something we could look at in the [2000 to 2003] life-term of the policy."

Mike MacAvoy, chief executive of the Alcohol Advisory Council, which helped produce the strategy, said last night that changing the present tax set-up would need strong justification.

The Hospitality Association chief executive, Bruce Robertson, was concerned that the anti-alcohol lobby would see the proposal as a means to push up the tax on beer and wine to the same level as that of spirits.

The strategy notes that while annual alcohol consumption has declined considerably in the past 15 years, binge-drinking remains a worry.

"The heaviest 5 per cent of drinkers alone were responsible for drinking a third of all alcohol consumed, each one drinking an equivalent of 63 cans of beer a week," the strategy says, citing a 1995 national study.

An Auckland University study found that the amount drunk in a typical drinking occasion increased in the 1990s.

The proportion of 14-to-19-year-olds who were drinkers declined from 82 per cent, to 77 per cent.

But the amount consumed at a typical session rose from three to four drinks in 1990, to five to six drinks in 1999.