IEA Response to the Alcohol Health Alliance: Tax all alcohol at the same rate
3 February 2017
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Reaction to calls for the government to increase duty on 'cheap' alcohol
Commenting on the Alcohol Health Alliance’s call on government to increase duty on cheap, high strength alcohol, Christopher Snowdon, Head of Lifestyle Economics at the Institute of Economic Affairs, said:
“Alcohol taxation in the UK is illogical and inconsistent. Strong cider is taxed at 7p per unit while strong, fizzy cider is taxed at 34p per unit. Spirits and wine are taxed at anywhere between 8p and 25p, which is totally nonsensical. Alcohol duty should be directly levied on alcohol – all units of alcohol should be taxed at the same rate.
“Alcohol abuse costs public services up to £3.9 billion in England.* The Government should set a tax on all units of alcohol to cover those costs. In practice, that means raising taxes on some strong ciders and cutting taxes on other drinks.
“Overall, British drinkers are grossly overtaxed. We pay 40 per cent of all the alcohol duty raised in the EU. By the standards of most countries, cheap alcohol does not exist here.”
Notes to editors:
*The IEA estimated that the cost of alcohol to public services was £3.9 billion in 2014/15 in it’s publication Alcohol and the Public Purse
For media enquiries please contact Nerissa Chesterfield, Communications Officer: nchesterfield@iea.org.uk or 0207 799 8909 or 07766 221 268
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
The IEA is a registered educational charity and independent of all political parties.
“Alcohol taxation in the UK is illogical and inconsistent. Strong cider is taxed at 7p per unit while strong, fizzy cider is taxed at 34p per unit. Spirits and wine are taxed at anywhere between 8p and 25p, which is totally nonsensical. Alcohol duty should be directly levied on alcohol – all units of alcohol should be taxed at the same rate.
“Alcohol abuse costs public services up to £3.9 billion in England.* The Government should set a tax on all units of alcohol to cover those costs. In practice, that means raising taxes on some strong ciders and cutting taxes on other drinks.
“Overall, British drinkers are grossly overtaxed. We pay 40 per cent of all the alcohol duty raised in the EU. By the standards of most countries, cheap alcohol does not exist here.”
Notes to editors:
*The IEA estimated that the cost of alcohol to public services was £3.9 billion in 2014/15 in it’s publication Alcohol and the Public Purse
For media enquiries please contact Nerissa Chesterfield, Communications Officer: nchesterfield@iea.org.uk or 0207 799 8909 or 07766 221 268
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
The IEA is a registered educational charity and independent of all political parties.
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