News and Press

Review of Alcohol Price and Taxation

31 Aug 2010

SHAAP has submitted a response to the HM treasury review of alcohol pricing and taxation.

In it, we argue that alcohol taxation policy should explicitly acknowledge and consider health objectives and a successful policy should be measured by its effectiveness in reducing alcohol related health harm. Alcohol is not an ordinary commodity and it should not be traded as if it were such. These facts must be considered when reviewing tax and pricing policy.

The financial cost of harm from alcohol is significant. Deliberate policy decisions combined with changing production methods have resulted in alcohol becoming cheaper, stronger and more available.

Strong and extensive evidence indicates that one of the most effective and efficient means of reducing rates of alcohol-related disorder and health harm is by increasing the price of alcohol.

We believe that Increasing price impacts most on those who drink the most. Moderate drinkers are affected very little by price increases in terms of spending as they drink relatively small amounts.

We argue that establishing a minimum price for alcohol would prevent below-cost selling and loss-leading. Evidence suggests that setting a minimum price of 40p per unit of alcohol or above would be an effective means of reducing alcohol-related harm.

Alternative proposals for preventing below-cost selling by banning the sale of alcohol below duty and VAT will not be effective in reducing alcohol-related harm.

The UK Government plan to report on the outcomes of the review in the Autumn.

You can read our full submission here.