Thursday
5th April 2001
DRINKERS, & INDUSTRY, IN HIGH SPIRITS
The Distilled
Spirits Industry Council of Australia (DSICA) today welcomed the passage
of the new alcohol excise rates through the Senate as a major victory
for spirit drinkers.
“This finally enshrines in legislation the Government’s
1998 commitment that a can of pre-mixed spirits should be taxed basically
the same as a can of beer,” said the Executive Director of DSICA,
Mr Gordon Broderick, “although some unnecessary anomalies still
remain.”
“This commitment, implemented from 1 July 2000,
has led to a significant reduction in the excise on pre-mixed spirits,
delivering a saving of about 20% to consumers and flow-on benefits
to hoteliers and retailers,” said Mr Broderick.
“The Government is to be congratulated for recognising
that far from being a select drink of the few, pre-mixed spirits are
no different to beer, are enjoyed by average Aussie drinkers in the
same situations and locations as beer, and should therefore be taxed
accordingly,” said Mr Broderick.
“DSICA acknowledges that the Government’s commitment
is also supported by the Democrats and the Opposition, as well as
many in the health sector, who recognise that there is the same amount
of alcohol in a nip of spirits as in a pot of beer or glass of wine
(1 standard drink), and that pre-mixed spirits responsibly contain
a consistent and measured amount of alcohol comparable to beer.”
Prior to 1 July 2000, taxes on ready-to-drink products
(RTDs) were riddled with historical anomalies. Even though a can of
beer, pre-mixed spirits, or wine-based designer drink are all basically
the same size and alcohol strength, pre-mixed spirits paid excise
about twice that paid by beer, and
wine-based designer drinks paid no
excise at all.
To address this, the Government announced that under
the new tax system, all RTDs with 10% alc./vol or less (not covered
by the Wine Equalisation Tax) would essentially pay the full-strength
beer excise rate, although still not enjoying the concessions available
to beer. These new excise rates were gazetted with effect from 1 July
2000, and finally enshrined in legislation today.
“Consumers have responded enthusiastically to the
reduced price differences between beer and pre-mixed spirits,”
said Mr Broderick. “Available data shows that the increasing
popularity of pre-mixed spirits reflects existing drinkers switching
their preferences from other RTD categories and bottled spirits to
the responsible convenience and variety of pre-mixed spirits.”
“This historic alcohol tax reform not only delivers
substantial savings to Australia’s spirit drinkers and certainty
to the industry, but is a welcome first step towards recognising that
‘alcohol is alcohol’ and should be taxed according to its
strength, not method of production,” said Mr Broderick.
