Reduce Harm – Increase Tax On Alcohol Says Sallies.

The Salvation Army is calling for a 25 per cent tax increase on alcohol to counter some of the damage caused by New Zealand’s out-of-control drinking culture.

In report released today entitled Excising Excess, The Salvation Army argues that the Government should immediately increase tax on alcohol as a way of minimising the harm caused through the excessive consumption of alcohol.

A 25 per cent increase in excise would have little effect on moderate drinkers but could reduce alcohol consumption by teenagers and heavy drinkers – the most price-sensitive drinkers – by as much as 10 per cent.

“Changes in this order would markedly reduce the misery and the social and fiscal costs associated with dangerous drinking without penalising responsible drinkers,” Director of The Salvation Army’s Social Policy and Parliamentary Unit Major Campbell Roberts says.

Such an increase would mean a rise of about 20 cents on the price of a handle of beer at a bar or a 50 cent increase of a bottle of wine bought in a supermarket. An 8 per cent strength six-pack of bourbon and cola or a cheap three-litre cask of wine would rise by $2.

The Salvation Army recommends scrapping the current system of liquor excise, which is complex and contradictory with low-alcohol drinks more often costing more than mid or high-alcohol strength drinks.

“The current approach to taxing liquor is a mess,” Major Roberts says. “We believe alcoholic drinks should be taxed solely on their alcohol content, and drinks with less than 2.5 per cent alcohol content be exempt of excise duties.”

The additional tax revenue, of perhaps as much as $160-180 million, could be invested in harm-minimisation programmes. These could include social marketing campaigns to educate people on alcohol-related risks, proven community-based campaigns to change attitudes towards hazardous drinking, more roadside breath-testing, and greater surveillance of liquor outlets to ensure they comply with age-of-purchase laws.

The proposal to raise tax on alcohol should not be seen by the Government as another method of raising tax revenues, but as a new approach that uses taxation to reduce harmful drinking, Major Roberts says.

The World Health Organisation has identified taxation as the most cost-effective policy mechanism to address the harm caused by hazardous drinking.

Salvation Army welfare centres have seen a growing number of families coming to them citing alcohol abuse and addiction as a leading cause of poverty and domestic violence in their lives.

Admissions for The Salvation Army’s intensive 8-week rehabilitation programmes for alcohol and drug addiction climbed 21 per cent in the year to September 2009.

∙ Excising Excess is available at: http://www.salvationarmy.org.nz/uploads/SPPUExcisingExcess.pdf

Issued on the Authority of Commissioner Donald Bell (Territorial Commander)
The Salvation Army, New Zealand Fiji & Tonga Territory

ENDS