Health Organisations Call for 2% Alcohol Duty Rise in UK

Mark Willingham Uncategorized

Health Organisations Call for 2% Alcohol Duty Rise in UK

The Drinks Business

by Edith Hancock 

February 3, 2020 

Health organisations in the UK are urging the government to raise duty rates on alcohol, claiming that the “burden alcohol places on society is unsustainable”.

Balance, the North East’s regional alcohol office, has joined the Alcohol Health Alliance (AHA), a coalition of more than 50 UK health organisations, in putting pressure on the government to increase alcohol duty by 2% above inflation to ease pressure on public finances.

The statement said that recent cuts to alcohol duty have cost the government more than £1 billion every year – enough to fund the salaries of 40,000 nurses or 29,000 police officers.

Citing a study by researchers at the University of Sheffield, it also said that duty cuts have had “tragic consequences for public health, including nearly 2,000 more alcohol-related deaths in England since 2012.”

In 2009, the government introduced an alcohol duty escalator that raised taxes by 2% above inflation each year. Then-Chancellor Alistair Darling’s 2010 Budget planned to extend the duty escalator until 2014. However, it was scrapped in 2013 for beer, and 2014 for other drinks. A series of duty freezes for beer and spirits have been placed in the Treasury’s budget statements since.

Colin Shevills, director of Balance, the North East Alcohol Office, called for an end to tax relief on alcohol when the funds raised “could help fund the vital front line services most of us rely on,” adding that that alcohol places an “unsustainable” burden on the NHS.

A Treasury spokesperson told the drinks business: “Overall alcohol consumption has fallen in recent years, but we continue to look at the range of measures available to control excessive consumption through tax and regulation. Alcohol duties raise £12 billion to pay for vital public services like the NHS.”

“We keep the tax system under constant review. Any changes would be made at the Budget in the context of the wider public finances.”

What the researchers said

Last year, researchers were commissioned by the Institute of Alcohol Studies (IAS) to look into the impact this has had on the NHS. It found that cuts to alcohol duty since 2012 have led to a 1% rise in consumption in England.

According to the Sheffield Alcohol Research Group, this has led to nearly 2,000 extra alcohol-related deaths, compared to if the escalator had remained in place until 2015.

The study looked at data on alcohol consumption, consumer spending habits, consumer and supplier responses to duty changes, alcohol related hospital admissions and deaths, health inequalities, costs to the NHS and costs associated with alcohol-related crime and workplace absence. It claimed the cuts have led to over 61,000 hospital admissions since 2012, costing the NHS roughly £317 million, and has also generated an estimated additional 111,000 instances of alcohol-related crime, as well as an economic value of £58 million in lost working days for businesses in England.

Senior research fellow at the University of Sheffield’s Alcohol Research Group, Colin Angus, said that “due to the complex relationship between alcohol and health, the effects of government duty policy since 2012 will continue to be seen for many years into the future, estimated to be as high as 9000 additional deaths by 2032.”

The drinks industry’s stance

The call comes just days after the Wine and Spirit Trade Association (WSTA) issued a statement of its own calling for a 2% cut to alcohol duty in the next budget, claiming it would be a boon to the public purse.

Miles Beale, the WSTA’s chief executive, said last month that alcohol duty is “an important revenue stream for Government to fund public services, which is precisely why we are calling for a 2% duty cut on wine and spirits.

“A cut will not only boost Treasury coffers but also bring a boost post-Brexit to British businesses and consumers, whereas another rise will have a negative impact on all three.”

The Campaign for Real Ale, unsurprisingly, also regularly calls for duty freezes on beer. Following the Conservative party’s victory in the general election last December, UK prime minister Boris Johnson pledged to review alcohol duty rates as a way of supporting the country’s pub and bar sector.

CAMRA National Chairman Nik Antona, welcomed the news, claiming that beer duty in the UK is “disproportionately high compared to other leading brewing nations in Europe and 56% of consumers find the price of a pint unaffordable.”

Commenting on this week’s call to raise alcohol duty, however, Shevills said it is “ironic that the alcohol industry is benefiting from around £1 billion in alcohol duty reductions every year, while it costs the North East £1 billion a year to mop up the fallout from the product they are selling.”

He said the burden alcohol places on society is “unsustainable and we’re all paying the price.”

“In the next Budget, the government has an opportunity to act by ending tax cuts for the alcohol industry. We are urging them to prioritise public services, including the NHS, police and education system, and intervene to bring alcohol harms under control.”

Professor Sir Ian Gilmore, chair of the Alcohol Health Alliance UK, said: said: “Alcohol is 64% cheaper than it was thirty years ago, and its availability at these prices is encouraging more of us to drink at unhealthy levels. It is no coincidence that deaths from liver disease have increased in line with alcohol’s affordability in the UK.

“In order to protect the future health of our society, the government must take action now by increasing duty on alcohol and investing that money into our over-stretched and underfunded NHS and public services.”