Wine, cider and beer drinkers may soon have to pay more for their favourite drinks if proposed alcohol tax increases are implemented.
The proposal recommended by the Foundation for Alcohol Research and Education (FARE) in its pre-budget submission would raise $2.9 billion per year, with wine taxed in the same way as beer – by the volume of alcohol rather than price.
Beer drinkers would pay about five cents more per glass and a $15-$20 bottle of wine would increase by about $3.80. FARE estimates that the price increase would cause a 9.4 per cent fall in alcohol consumption.
“Reforming the alcohol tax system should be a no-brainer. In fact nine separate Government reviews have recommended we do exactly that,” said FARE chief executive Michael Thorn. “Increasing taxes on alcohol would not only address the budget deficit but, as research shows, is also the most cost-effective way to reduce alcohol consumption and the resulting harms, particularly among young people and risky drinkers.”
The Winemakers’ Federation of Australia says money the government makes on the changes should be spent on promoting Australian wine overseas.
The federation’s chief executive, Paul Evans, said there was a reason wine was taxed differently under the present system.
“Wine is different when it comes to our socio-economic input into regional Australia, employment footprint, contribution to export earnings, profitability and access to capital, compared with the vastly different brewing and spirits industries and it’s only fair that alcohol tax rates reflect this,” he said, adding that Australian wine is among the most heavily taxed in the world.
The federation told The Newsroom Australia’s wine industry contributes $40.2 billion dollars to the national economy and is responsible for almost 173,000 jobs. – Joseph Walz
Photo of wine glasses from Alice Salles’ Flickr photostream.