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Should the Senate pass the alcopops tax legislation?

Tuesday, 1 July 2008

Geoff Munro, director of the Community Alcohol Action Network, writes:

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If the independent and minor party Senators who hold the balance of power reject the Rudd Government’s tax on ready-to-drink pre-mixed spirits (RTDs), they will reward the alcohol industry for misleading the Senate Inquiry into RTDs. They will ignore proof that RTDs are consumed by the youngest underage drinkers who engage in dangerous drinking.

Independent Distillers Australia (IDA) is a major manufacturer of RTDs (or alcopops) which represent 94% of its business. Its formal submission to the Senate Inquiry denied RTDs are implicated in binge drinking: “RTDs…have not been directly linked to risky drinking behaviour” (p10) and it cited the 2004 National Drug Strategy Household Survey (NDSHS): “...[the report] showed beer, wine and spirits were listed as being consumed in risky and high risk quantities, but, very significantly, RTDs were not”( IDA submission, p9).

The quote is accurate, but misleading. The statement is true only for people whose drinking puts them at risk of long-term harm. But for the youngest drinkers, aged 14-19, who are at risk of harm in the short-term i.e. due to intoxication and its effects, the result is reversed. Three-quarters prefer RTDs: 73% of males aged 14-19 at risk of immediate harm favour RTDs and 77% of females prefer premixed spirits or spirits equally. (see this data collected by the Australian Institute Health and Welfare, which is devastating for the industry view that alcopops are not implicated in dangerous drinking.)

The case for RTDs to be taxed at the same level as spirits is well founded because it is clear they contribute to both underage drinking and binge drinking. There is no reason to give a tax break for manufacturers of drinks that are most attractive to adolescents. If the Senate should block the legislation it will reward the deceptive conduct of IDA and strike a blow against evidence-based policy.

What do you think the Senate should do?

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Professor Wayne Hall, University of Queensland Tuesday, 1 July 2008 5:08:08 PM: Veracity is not a strong point when alcohol beverage industry advocates are defending their right to market their products. The media have conspicuously failed to unearth the half truths and misrepresentations that have been so well explained in Geoff Munro’s piece. The media have also failed to examine the so called evidence behind the Industry-funded Drinkwise media campaign that informs us (shades of Tony Abbot on junk food) that binge drinking is all the fault of parental bad examples. It apparently has nothing to do with the products that they market or the ways in which they market them. It’s the bad example set by all those middle-aged parents bingeing on RTDS.
Dr Rod Macqueen Tuesday, 1 July 2008 5:13:59 PM: Geoff Munro’s comments reinforce what all adults should know to be true – that “self regulation” is incompatible with the way modern business operates, and anything that threatens profits, and profit growth, is to be resisted by any means. IDA has merely learned from the tobacco companies that half truths and distortions are quite OK so long as they confuse the issue and allow another few years of profit raking. Whilst the best data suggests that uniform taxation by alcohol content is the most logical tax response to reducing alcohol related harm, and hence this alcopops approach is more about politicians needing to appear in control than about a well reasoned, sustainable harm reduction approach, the mendacity of the alcohol pushers must not be rewarded. We should tax ALL their products at this same higher rate. It is time for our political representatives to accept the overwhelming evidence that alcohol is not just another product bought and sold on the open market, but rather a product with side effects, problems and dangers predictably associated with use. Just like tobacco, gelignite and Prozac, its use needs careful control and regulation by disinterested, well informed outsiders, not mendacious industry insiders.
Dr Alex Wodak Tuesday, 1 July 2008 5:55:57 PM: While the alcopops issue should certainly be considered on its merits, it is also critical to think about the bigger picture of our favourite drug. By drawing attention to alcopops, the Rudd government has over the last 6 months cast the spotlight on alcohol as a public health and policy issue. In contrast, the Howard government largely ignored alcohol as a public health issue. Tony Abbott, the last Health Minister in the Howard government, still argues that concern about the 3,500 alcohol-related deaths, millions of Australians suffering social harms from alcohol and the $15 billion damage to the Australian economy each year is just 'moral panic'. The drinks industry and its many friends argue that the situation is not getting any worse. The implication of these comments is that if it is not getting any worse, the present situation QED must be acceptable. Public health practitioners argue that with alcohol claiming more lives of young Australians each year than the combination of heroin, amphetamine, cocaine and cannabis, surely the community should be asking itself whether improvements are possible.
The biggest negative about the alcopops tax is that it is yet another Band Aid on a broken alcohol tax system that badly needs root and branch repairs. Admittedly, that is asking for the expenditure of some precious political capital. But with the current alcohol tax system simply reflecting the strength of the different sections of the alcohol beverage industry, it is hardly any surprise that our current alcohol taxes make no economic sense and even less public health sense. If Australia really wants to reduce the yawning health gap between indigenous and non-indigenous Australians, than alcohol tax reform will have to be on the table.
Garth Tuesday, 1 July 2008 8:57:45 PM: What about raising the tax on all alcohol products to the same high tax rate if Rudd is so concerned about the effects of cheap alcohol on the 'impresionabe and venurable' youth binge drinkers? Let's be so hypocritical and selective on mixed alcohol drinks. Of course, that will include beer and other mixed drinks available across the bar so avaiabe at all our social entertainment venues.
Terry Slevin Wednesday, 2 July 2008 12:31:44 AM: If the independent Senators, or the Rudd government accept the advice and guidance of the various parts of the alcohol industry, and their fellow travellers and apologists, we are in for many more years of unfettered and aggressive promotion of the various alcoholic beverages. All in the absence of any serious attempt at regulatory control.

Alcopops are carefully prepared and effectively marketed products which act as a very effective entry products for children into the world of alcohol. Sweet and palatable, stronger than beer, colourful and until recently, easily affordable to a teenagers shallow wallet.

Do they need to be taxed more ? Certainly

Do we need to review the entire tax structure applied to alcoholic products in Australia so as to allow the tax level to reflect the alcohol content? Definitely.

Will we see the best funded, no holds barred, smoke and mirrors campaign by members of the industry who think their sales will be effected by a change in the tax structure ? You bettya.

Harm linked with alcohol consumption is a fixture in the public health data in this country and only going in one direction - up, with the current generation of teenagers looming to break al the records. Turning that around means making some tough decisions, ones the industry won't like.

Will our legislators have the courage to take on big liquor ? There is the first test for some years just around the corner. The big test will unfold over the next 5 years. Will Australia tackle booze? Lets hope so.

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Should the Senate pass the alcopops tax legislation?

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