Minimum unit pricing and strength-based taxation have larger impacts on health inequalities than increasing current alcohol taxes.

Introducing minimum unit pricing or alcohol-content-taxation would reduce inequalities in health more than increasing alcohol duty under the current tax system or increasing VAT on alcohol, a new report has shown.

Research from the University of Sheffield’s Alcohol Research Group (SARG) compared four policy strategies for regulating alcohol prices to estimate how changes in alcohol price would affect individual levels of alcohol consumption and the subsequent impact on illness and deaths associated with 43 alcohol-attributable conditions in England.

The study, which is the first of its kind, showed that strategies which strongly link alcohol content with the price of drinks were more suited to tackling health inequalities compared to the current duty system where wine and cider are taxed by total beverage volume regardless of strength, and duty rates per unit of alcohol vary widely between different types of drink.

There are substantial mup-graphhealth inequalities in England, with people in the lowest socioeconomic group dying on average six years earlier than those in the highest. Reducing inequalities in health is a key priority across the globe and tackling alcohol-related harm plays a major role in reducing the gap.          

The research, published today (23 February 2016) in the leading medical journal Plos Medicine, revealed a tax based on alcohol strength and minimum unit pricing would both have large impacts on harmful drinking across all socioeconomic groups, whilst having minimal effects on those drinking in moderation.

The four pricing strategies were chosen at a level estimated to prevent exactly the same number of alcohol-related deaths in the population so that the researchers could compare effects in different groups of the population.

The strategies were:

1) A 13.4 per cent increase in duty for all products under the current UK system.

2) A four per cent tax based on product price.

3) A strength-based tax of 22p per UK alcohol unit.

4) Minimum price of 50p per unit, below which alcohol cannot be sold.

“Alcohol is now 54 per cent more affordable in the UK than it was in 1980 and harmful alcohol consumption is a major public health issue accounting for an estimated 2.7 million deaths globally.

Our findings suggest that minimum unit pricing and taxing alcohol by strength are a well-targeted interventions which would lead to greater reductions in health inequalities compared to the current UK duty system or taxes levied on sales price – a tax system prevalent in many developing countries.

Our results also suggest that a substantial 13.4 per cent increase in current duty would be required to achieve the same overall harm reductions as a 50p minimum unit price.

EU countries have limited options however, as EU law prohibits taxation by strength for wine and cider. The implementation of minimum unit pricing in Scotland is still held up in a court case brought against the Scottish Government by the alcohol industry, where the Government needs to demonstrate that minimum unit pricing would have important public health benefits that cannot be achieved as effectively through existing taxation powers.

Similar plans in Wales, Northern Ireland and the Republic of Ireland are resting on the outcome of this court case. Although set in England, our study makes a major contribution to the evidence in this respect.”

Professor Petra Meier

Director of SARG at the School of Health and Related Research (ScHARR)  

“Alcohol taxes are the most common intervention internationally, although minimum unit pricing has recently started to attract much international interest. Until now there was little evidence to support policy makers wishing to compare the health impacts of different taxation. 

Minimum unit pricing and strength-based taxation are better-targeted than the current UK tax system for reducing alcohol-related harm as they have larger effects on heavy drinkers and smaller effects on moderate drinkers.”

Dr John Holmes, Senior Research Fellow at SARG

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