Jessica Irvine and Yuko Narushima – The Sydney Morning Herald – April 28, 2008
THE Rudd Government’s chief adviser on preventive health has called for an increase to the excise on tobacco of 2.5 cents a cigarette, which could raise $400 million a year on top of the $500 million to be raised from the increased excise on “alcopops”.
Rob Moodie, who chairs the National Preventative Health Taskforce, said the increased excise on ready-mixed spirits – imposed at the weekend to fight teenage binge drinking – was “terrific” and should be extended to cigarettes.
“Using taxation or pricing as a lever for reducing harmful consumption is a really good idea,” Dr Moodie told the Herald.
He said Australians were very sensitive to price rises, and increasing the excise by 2.5 cents a cigarette would reduce consumption by about 3 per cent.
“There is certainly room to move [and] this issue will certainly come up in the taskforce,” Dr Moodie said.
The Government has raised the excise on drinks such as Bacardi Breezers and Vodka Cruisers from $39 per litre of pure alcohol to $67, adding as much as $1.30 to a bottle.
The excise was expected to raise $2 billion over four years, or $500 million a year, a “significant proportion” of which would be channelled into preventive health programs, a Government spokesman said.
It comes as a National Household Drug Survey reveals that risky drinking has risen among girls and young women. The survey found that girls aged 14 to 19 were more likely than boys their age to drink at risky levels. It found 10 per cent of teenage girls had 15 or more drinks in a week, and 4 per cent were at high risk of doing long-term harm by consuming 29 drinks or more. This compared with 7 per cent of teenage boys drinking at dangerous levels. Less than 3 per cent of boys consumed high-risk quantities of alcohol – for them, 43 drinks or more in a week.
According to the Australian Bureau of Statistics, 60 per cent of female drinkers aged between 15 and 17 consume pre-mixed drinks, compared with 14 per cent in 2000.
“This is an explosion that we think needs to be tackled,” the Minister for Health, Nicola Roxon, told Channel Nine yesterday. “We have a problem that must be turned around and this is the place where we’re starting.”
She blamed the Howard government for fuelling binge drinking when it cut the excise in 2000, with the introduction of the GST. The Opposition Leader, Brendan Nelson, called this an “outrageous slur” but supported the tax rise as long as some of the money was spent on public hospitals and drug treatment.
Paul Dillon, from the National Drug and Alcohol Research Centre, said it might not work. “One of the common misperceptions is that young people see pre-mixed drinks as cheap, whereas if you speak to any teenager they’ll tell you it’s actually an expensive option.
“So price will be a barrier for moderate drinkers, but problem drinkers will just move to the cheaper alternative, which is commonly spirits.”
Health groups welcomed the increase but urged the Government to go further.
The chief executive of the Australian Drug Foundation, John Rogerson, wants a uniform tax on all drinks, based on the amount of pure alcohol they contain. “This is a big step in the right direction but there’s some way to go,” he said
The Alcohol Education and Rehabilitation Foundation wants a full review of alcohol taxation and is calling for a volumetric tax across all alcohol products. “We believe this is the fairest system, and one which will ensure binge drinking challenges are comprehensively addressed,” said the foundation’s chief executive, Daryl Smeaton.
The latest available figures show alcohol cost the Australian economy $15.3 billion in 2004-05 through lost productivity, crime, violence, treatment and premature death.
A spokesman for Ms Roxon said there were no plans to extend the tax rise to other alcoholic drinks or cigarettes but the Government would listen to its taskforce’s recommendations, which are due in full by June.