Alcopops tax has failed, says Taxpayers' Alliance

Recent Australian Bureau of Statistics (ABS) data on alcohol consumption shows that the ‘alcopops tax’ on ready-to-drink (RTD) alcoholic beverages has failed, the Australian Taxpayers’ Alliance and MyChoice Australia claim.

“The empirical evidence is overwhelming: the tax on RTDs has done nothing to impact overall drinking,” said Tim Andrews, executive director of the Australian Taxpayers’ Alliance. “Instead, it has simply shifted drinking to stronger alcoholic products, particularly full-strength spirits.

“The consumption of full-strength spirits remains considerably higher than at pre-alcopops tax levels, with higher-strength wines and ciders also experiencing relative growth while overall per capita consumption remains stable, continuing a long-term mild downward trend.

“Furthermore, the preferential tax treatment of ciders has led to a tripling of per capita consumption since the alcopops tax was introduced. This is not only distortionary but, with ciders having an average higher alcohol content than RTDs, and anecdotal evidence suggesting the growth is primarily in sweeter ciders mimicking the taste of RTDs, it is simply absurd.”

In April 2012, www.foodprocessing.com.au reported that the Alcohol Policy Coalition (APC) had called for alcohol taxation reform, claiming that cider and cheap wine should be taxed in the same way as alcopops. The APC’s Legal Policy Adviser Sondra Davoren said the current tax system has led to cider “increasingly filling the gap left by alcopops”. The APC claimed the alcopops tax has led to an 18% increase in cider consumption.

MyChoice Australia says it will shortly launch a campaign urging the government to scrap the alcopops tax.