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"Distillers Want Spirit Tax Freeze At Budget"

"Distillers Want Spirit Tax Freeze At Budget"

"If Michael Cullen is looking for ways to raise revenue in next month's Budget, his easiest target will be reforming the alcohol tax banding system, as proposed in a recent report to the Alcohol Advisory Council," says the Distilled Spirits Association.

"Duty bands" are currently used. This means some drinks are levied at a lower averaged alcohol content rather than being taxed at its actual alcohol content.

The appropriateness or otherwise has caused revenue leakage for Treasury.

Thomas Chin, Chief Executive of the Distilled Spirits Association, says taxing beverages at their actual alcohol strengths and implementing one excise rate for all alcohol beverages, is an important step towards a more equitable system.

"Spirit drinkers will be staggered to learn that on a standard drink basis they unfairly pay out almost double the tax than beer or wine drinkers," he says.

Government could alleviate the excise burden on spirit drinkers by freezing existing rates while not applying a 2.6% tax hike scheduled for 1 June.

"On a $25 dollar bottle of spirits, Government takes over $17 in tax which makes it particularly tough for those less well off," Mr Chin says.

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