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Effects of changes to the taxation of beer on alcohol consumption and government revenue in Australia.

Authors :
Vandenberg B
Jiang H
Livingston M
Source :
The International journal on drug policy [Int J Drug Policy] 2019 Aug; Vol. 70, pp. 1-7. Date of Electronic Publication: 2019 May 01.
Publication Year :
2019

Abstract

Background: In 1988, the Australian government introduced a single nominal rate of tax on all beer products calculated on alcohol content. However, in 2000/01, varying nominal rates of tax were introduced for beer products according to three alcohol content levels (low-/mid-/high-strength) and container type (on-/off-premises). Little is known about the effect of the different tax policies on alcohol consumption and government revenue.<br />Methods: We undertake time series analysis over 1989-2016 to examine the effect of beer tax policies in two sub-periods (before/after 2000/01) on category-level beer consumption per capita and government revenue. We also test if the policy changes in 2000/01 had immediate or long-term effects on total (all beer category) consumption over 1989-2016. Data includes monthly domestic beer sales volumes by category (in litres of alcohol), monthly government revenue from beer tax (AUD$), and inflation-adjusted tax rates (AUD$ per litre of alcohol).<br />Results: Before 2000/01, the single nominal tax rate had a significant positive effect on revenue, but no significant effect on consumption. After 2000/01, the relatively higher nominal tax rates for two beer categories (mid- and high-strength off-premises) had a significant negative effect on their consumption, and a significant negative effect on revenue in one category (mid-strength off-premises). However, across the full period examined (1989-2016), the level and slope of total beer consumption was not significantly affected by the tax policy changes in 2000/01.<br />Conclusion: Raising alcohol taxes has the potential to reduce consumption and increase government revenue, but has been underutilised for these public health and public finance objectives in Australia.<br /> (Copyright © 2019 Elsevier B.V. All rights reserved.)

Details

Language :
English
ISSN :
1873-4758
Volume :
70
Database :
MEDLINE
Journal :
The International journal on drug policy
Publication Type :
Academic Journal
Accession number :
31054371
Full Text :
https://doi.org/10.1016/j.drugpo.2019.04.012