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 If only we could live in an ideal, uncool-to-be-drunk world 

If only we could live in an ideal, uncool-to-be-drunk world

6/08/2008 9:46:00 AM
The current debate about the level of taxes on ready-to-drink ''alcopops'' shows, in stark terms, how little understanding professional anti-alcohol advocates have about taxation.

Writing in The Canberra Times last month, (''Close tax loopholes to fight rise in risky drinking'', July, 31, p17) Alcohol Education and Rehabilitation Foundation chief executive Daryl Smeaton argued both in favour of and against the ''alcopops'' tax increase. He did this by offering tacit support to both the Government's tax increase and to volumetric taxation which would reverse this increase and extend tax concessions to full-strength spirits.

At its heart, volumetric taxation is a simple concept: each unit of alcohol should be taxed at the same rate. In an area which is full of complexity the simplicity of this idea has all the attraction of the siren's song. But this is usually where the attraction stops and problems begin.

It is helpful in dealing with the policy challenge to understand the concept of ''adultessence'' here.

A few generations ago it was the norm for young people to have a few years between being a young post-school adult and settling down with a mortgage and kids, at which point individual drinking behaviour usually moderates. Now the period where adolescence and adulthood overlap can routinely stretch for a decade or more. This has been studied by many academics and is a value-neutral phenomenon, ie, it is seen as neither good nor bad. It does, however, diminish the effectiveness of price as a lever to change behaviour except perhaps for the very young, ie, under-age drinkers who are likely to have less disposable income (whom the Government argues are particularly attracted to alcopops).

Shifting to a volumetric taxation system would not only lower the price of alcopops but also the price of full-strength spirits. It would also have the effect of overturning generations of deliberate industry policy to build a domestic drinks industry which underpins employment in regional agriculture in large malting barley and wine grape communities.

Beer is the ultimate import replacement story with nearly all beer being brewed in Australia from local grains, whilst wine and malting barley are important export trade successes. To embrace volumetric taxation now is to abandon established industry, agriculture and trade policy in this area.

Modelling supplied by Access Economics, which the Associated Brewers presented to the recent Senate Inquiry into RTD taxation shows that a revenue neutral volumetric tax for alcohol would result in a 24 per cent rise in the price of light beer in pubs and a 37 per cent decrease in full-strength spirits. The Australian Alcohol Guidelines show light beer has an alcohol content of 2.7 per cent and full-strength spirits have an alcohol content of 40 per cent.

Some professional anti-alcohol advocates would be alarmed at this outcome. Indeed some presenting to the Senate Inquiry tried to advocate a vague modified form of volumetric in order to step around the obvious price windfall for spirits and ready-to-drink products which would occur, whilst still supporting the principle. Unfortunately, this cannot be done. Any variation to the volumetric holy grail of ''alcohol units = tax units'' actually renders it non-volumetric. By nips and tucks to the volumetric principle, the policy designer cannot avoid responsibility for creating winners and losers amongst competing domestic and overseas alcohol producers. Thus the volumetric debate risks becoming an unnecessary distraction.

Extreme drinking behaviour will not be substantially curbed until, it is ''uncool'' to be intentionally drunk. Government-sponsored research regularly reports the most effective lever for changing drinking behaviour is potential social embarrassment rather than potential adverse health outcomes, and that the involvement of parents is a critical influence on the drinking behaviour of younger people.

So the command and control approach of many anti-alcohol activists which seeks to focus on producer behaviour rather than consumer behaviour, would, if embraced by lawmakers, rather miss the point.

Surely alcohol policy can be sophisticated enough to acknowledge emerging trends such as ''adultessence'' and the benefits of good industry policy and that the vast majority of adults drink responsibly (and enjoy social and health benefits from doing so) all at the same time.

Through programs such as Rethinking Drinking (see www.rethinkingdrinking.org) and Drinkwise (see www.drinkwise.com.au) the brewing industry has shown its commitment to a partnerships approach to improving drinking culture, based on rigorous research and evidence on what motivates drinking behaviour.

Stephen Swift is the executive director of Australasian Associated Brewers.

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Comments


So, tell us all the health benefits of getting pissed and becoming alcoholics then mate? I believe it costs the health system some $14 billion extra per year as a legal drug while we whinge about heroin.
Posted by Marilyn on 6/08/2008 2:19:18 PM
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