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Sunday, 3rd August 2008

Taxing alcopops: the Australian experience 

Fraser Nelson 4:59pm

Taxing alcopops is one of Tory ideas designed to stop youth drinking. “They've done this kind of thing in Germany and Australia and it has had dramatic effects,” George Osborne told Andrew Marr last March. Just how dramatic is now clear, with the evidence now in from Australia. Jacking up pre-mixed drink prices by 70% cut their consumption by 30%, but pushed bottled spirit sales up by 46% as kids mixed their own. And - surprise, surprise - the people pour far more generous measures than they were getting with the Bacardi Breezers. Result: a sharp 10% hike in the amount of alcohol consumed in Australia, the precise opposite of what was planned.

But there is some consolation for its government. The extra boozing means some A$600,000 a month extra in duties. This report in The Australian newspaper has all the tragicomic details. It’s such a shambles that the Australian Senate may now overturn the Rudd administration’s disastrous idea. As I say in my News of the World column today, it’s further proof that the law of unintended consequences is one politicians never fail to pass.

P.S. The Australian tax was introduced Rudd’s May 08 budget, so it’s unclear what “dramatic effects” Osborne was referring to in March. It gives a worrying insight into the quality of research. They’re so, so lucky Labour is in too much disarray to make this or any other point.

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Timothy

August 3rd, 2008 8:11pm Report this comment

What the Rudd government did was to equalise the amount of tax paid (per unit of alcohol) on premixed drinks and bottled spirits. Previously straight spirits had had higher taxes for precisely the reasons now given in The Australian, that drinking spirits straight or self mixing led to higher consumption. Raising the tax on alcopops was not social engineering (except to the extent that all alcohol taxes are social engineering), it was the abolition of a particular, apparently successful, form of social engineering. Almost all politicians on both sides of the debate have this backwards.

Ray

August 3rd, 2008 8:34pm Report this comment

Perhaps the Government could experiment by steadily jacking up the duties on canned beers and offsetting this measure by lowering the duties on draught beers. Not only would this help out Britain's embattled pub trade, but it would also make boozing on street corners more prohibitive.

Fraser Nelson

August 3rd, 2008 9:03pm Report this comment

Ray, the Tories do propose to lower duties on beer and cider with the money they raise from alcopops. But my concern is that the alcopop drinkers are - as Australis suggests - more likely to go to their improvised Malibu & Pineapple. If you like sweet drinks, you're unlikely to switch to bitter because it's 2p a pint cheaper.

Seasurfer1

August 3rd, 2008 11:07pm Report this comment

Alcopops are a Great British Product and are proposed to be taxed out of existence, so that the kids can mix and match imported molass based spirits.
The British Brewing Business has all but been taxed out of brewing, and we are left with imported lagers and beers.
Crackpot!! the whole tax thing from Tories and Labour.

jane from sydney

August 4th, 2008 2:56am Report this comment

The important thing is to make alcohol as undrinkable as for young women as it used to be before the introduction of alcopops. I wouldn't go out of my way for a Bacardi & coke, but even I was seduced by those pretty colours & the sweet flavour that masked the taste of alcohol. Keep the tax!

The Nurdler

August 4th, 2008 8:02am Report this comment

Presumably it would be fairer, given that Mr Osbourne makes reference to similar measures in Germany, to make some assessment of the results there before branding his research as inadequate.

Timothy

August 4th, 2008 8:08am Report this comment

Jane from Sydney - to be honest, the government's entire campaign against alcopops had an undercurrent of "men are using these to get vulnerable young women drunk. It's ok to keep spirits and beer and cask wine cheap, because men and winos drink those, but respectable young women drink vodka Cruisers, so something must be done to stop them."

John, North Adelaide

August 4th, 2008 8:08am Report this comment

The problem is that these figures were provided by the liquor industry. Subsequent Customs Dept. and Bureau of Statistics figures showed a marked fall in alcopop sales and only a small increase in hard liquor sales.

Terry Barnes

August 4th, 2008 8:34am Report this comment

On the timing issue, the Australian government introduced its alcopops excise wheeze with effect from the end of March. The May budget simply locked it in. So George Osborne is (sort of) right but also very wrong - it is a stupid, ill-measure by a Labour government with a nanny for a health minister and a drongo for a treasurer. Messrs Osborne and Cameron should steer away from such stupidity.

Marian C

August 4th, 2008 11:19am Report this comment

"Perhaps the Government could experiment by steadily jacking up the duties on canned beers and offsetting this measure by lowering the duties on draught beers. Not only would this help out Britain's embattled pub trade, but it would also make boozing on street corners more prohibitive"

Ray I agree with you, a lot of these young kids who are getting smashed out of their heads on drink don't all get drunk with just alcopops. A great many of them are getting drunk on very cheap ciders and canned lagers. I blame a lot of this on the Supermarkets for selling the alcohol so cheaply, and for stupid parents who buy their kids alcohol along with the weekly shop. The tax on alcohol being sold in supermarkets (especially that of ciders, lagers and yes, alcopops), should be hiked up and lowered in pubs.

jsfl

August 4th, 2008 2:13pm Report this comment

Seasurfer1 - You seem to be crowing about the fact that Alcopops are a great British Product. Well let me disavow of such a view.

Breezers and Smirnoff alcopops were first developed and marketed for the US market and 'Two Dogs' originated from the Land Of Oz and was imported to the UK. If I recall it was the first Alcopop to take off in the UK. All these pre-dated any home developed alcopops such as Hooch.

Furthermore, I wouldn't crow about any product that is based on a poison, damages your health if used persistently, and can, in excess, leave you in a stupour or encourage violence as any sort of alcohol does.

There are times when we can all do with a drink but I don't see that its anything to shout about.

Furthermore, there are times to wave the flag and times not to. Alcopops are not ours in the first place and are certainly not something to be proud of.

Fraser Nelson:

If all you are worried about is people switching to Malibu then the policy will have achieved one of its objectives. Malibu has a relatively low alcohol content in comparison to other drinks. I suppose Advocaat or Cinzano and Lemonade and the likes are just as much a threat?

Gordon Musgo

August 4th, 2008 6:01pm Report this comment

Could try enforcing the laws on public drunkenness, rather than this engineering nonsense. Pick them up outside the pub, put them in custody for H&S reasons till monday, or whenever the doc said the blood alc was all gone. You wouldn't have to do it much before people got the idea.

Or, plan B, stop interfering in the way people live their lives, and taxing 'sin' to fill govt coffers.

glen belbin

August 4th, 2008 6:37pm Report this comment

another article were figures have been obtained form the liquor industry (whom blind freddy can see has a vested interest in this tax being opposed) as opposed to treasury figures. The treasury figures suggest whilst there has been a seasonal increse in spirit consumption not out of line with historical trend there has been not only a massive drop in alcopop consumption but in alcohol consumption in whole. Please do your research even if it is a slow news day. Its a tax in australia that is rectifying an abnomally, but every tom dick and harry knows that kids are drawn to alcopops, and because that is not available does not mean that they will hit stronger spirits. If that was a proper argument then i could argue that stopping people under 16 buying tobacco will lead them to cannabis, ridiculous, hell yes...

Steve the Student

August 4th, 2008 7:23pm Report this comment

As much of a problem as the easy availability of alcopops is the culture of drinking we have now. When my colleagues at university go out in an evening, they're seeking to get drunk. It isn't just an accepted side affect, it's the whole point of the occasion, because it is synonymous with having a good time. And of course, you can't change people's behaviour or lifestyle choices with legislation although the socialists do try.

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