poledriver
Bluelighter
- Joined
- Jul 21, 2005
- Messages
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Aus - Why do we pay so much for alcohol?
AUSSIES love to drink, but we pay through the nose for it. So just why is our alcohol so expensive?
The World Health Organisation’s latest Global Alcohol Report put Australia in the second-highest band of alcohol consumption: total per capita consumption is between 10 and 12.4 litres of pure alcohol a year.
Last year, a report by Deutsche Bank found Aussies are paying among the highest prices on the planet. Australia is the third most expensive country to buy a pint of beer — 37 per cent higher than in the US — behind France and Singapore.
According to the Australian Hotels Association, around 20 per cent of the cost of beer at the pub is made up of tax.
Spirits are even worse: you can get a 750mL bottle of Jim Beam at an online liquor store in Colorado for $US17.99 ($A21.05). Compare that with a 700mL bottle of Jim Beam at Dan Murphy’s online: $A32.95.
INCOHERENT SYSTEM
Regardless of whether you think we pay too much or too little, Australia’s current alcohol taxation system is, put simply, a complete mess.
It’s a hodge podge cobbled together over 30 years of deals, dodges and industry favours.
Case in point: commercially produced beer today is taxed at no fewer than eight different rates, depending on a range of factors including alcohol volume and the type of packaging.
Meanwhile, wine is taxed not on alcohol content but sales value, meaning the cheaper the wine, the less it is taxed.
At the moment, there are broadly three different federal taxes that apply to alcohol:
• Excise, indexed twice annually in line with the Consumer Price Index
• The Wine Equalisation Tax (WET), which is based on sales value
• Customs duties — a combination of alcohol content and sales value
There is also the flat 10 per cent GST on all retail alcohol sales.
The automatic indexation was introduced by the Hawke Government 30 years ago as a way of avoiding negative headlines every budget.
At current taxation levels, drinkers pay 45c for every 1 standard drink in a full-strength beer. For spirits, which are taxed the highest, it’s an extra $1 per standard drink — a mark it hit for the first time this August.
The amount of tax paid per standard drink for cheap cask wine comes in at just 7c. Not surprisingly, the WET is the area identified as in need of urgent reform.
The 2009 Henry Tax Review outlined the problem, describing the current tax system for beer, wine and spirits as “incoherent”.
Incredibly, Ken Henry estimated that moving to a single volumetric tax system could add an extra $1.8 billion in revenue a year.
Cont -
http://www.news.com.au/finance/money/why-do-we-pay-so-much-for-alcohol/story-e6frfmci-1227135937816
AUSSIES love to drink, but we pay through the nose for it. So just why is our alcohol so expensive?
The World Health Organisation’s latest Global Alcohol Report put Australia in the second-highest band of alcohol consumption: total per capita consumption is between 10 and 12.4 litres of pure alcohol a year.
Last year, a report by Deutsche Bank found Aussies are paying among the highest prices on the planet. Australia is the third most expensive country to buy a pint of beer — 37 per cent higher than in the US — behind France and Singapore.
According to the Australian Hotels Association, around 20 per cent of the cost of beer at the pub is made up of tax.
Spirits are even worse: you can get a 750mL bottle of Jim Beam at an online liquor store in Colorado for $US17.99 ($A21.05). Compare that with a 700mL bottle of Jim Beam at Dan Murphy’s online: $A32.95.
INCOHERENT SYSTEM
Regardless of whether you think we pay too much or too little, Australia’s current alcohol taxation system is, put simply, a complete mess.
It’s a hodge podge cobbled together over 30 years of deals, dodges and industry favours.
Case in point: commercially produced beer today is taxed at no fewer than eight different rates, depending on a range of factors including alcohol volume and the type of packaging.
Meanwhile, wine is taxed not on alcohol content but sales value, meaning the cheaper the wine, the less it is taxed.
At the moment, there are broadly three different federal taxes that apply to alcohol:
• Excise, indexed twice annually in line with the Consumer Price Index
• The Wine Equalisation Tax (WET), which is based on sales value
• Customs duties — a combination of alcohol content and sales value
There is also the flat 10 per cent GST on all retail alcohol sales.
The automatic indexation was introduced by the Hawke Government 30 years ago as a way of avoiding negative headlines every budget.
At current taxation levels, drinkers pay 45c for every 1 standard drink in a full-strength beer. For spirits, which are taxed the highest, it’s an extra $1 per standard drink — a mark it hit for the first time this August.
The amount of tax paid per standard drink for cheap cask wine comes in at just 7c. Not surprisingly, the WET is the area identified as in need of urgent reform.
The 2009 Henry Tax Review outlined the problem, describing the current tax system for beer, wine and spirits as “incoherent”.
Incredibly, Ken Henry estimated that moving to a single volumetric tax system could add an extra $1.8 billion in revenue a year.
Cont -
http://www.news.com.au/finance/money/why-do-we-pay-so-much-for-alcohol/story-e6frfmci-1227135937816
