WSTA: Raising alcohol taxes will not solve problem drinking

Published: 23 July, 2008

The Wine and Spirit Trade Association (WSTA) has published its Budget submission arguing that higher alcohol taxes are not the key to solving problem drinking in the UK.

Instead, the trade body believes that higher taxes would punish the majority of responsible drinkers and reduce revenue for the Treasury while threatening over 50,000 jobs.

Jeremy Beadles: WSTA chief executive, said: "Raising the price of alcohol by raising taxes will unfairly punish the majority of responsible drinkers for the misdeeds of a small minority.

"Our research shows that any such increases will do little to address problem-drinking while hurting the economy and the Treasury. It simply does not make any sense."

WSTA Budget Submission

Under a 10% increase for both wine and spirits, the combined revenue loss from duty and VAT would be 102 million for wine and 92 million for spirits.

Under a 10% increase for both wine and spirits, the negative impact on the economy would be 1,572 million for wine and 1,262 million for spirits.

These increases would also cause a loss of employment of 28,000 for the wine industry and 23,000 for the spirits industry.

These increases would also have an inflationary impact during a time of increasing concern about inflation.

A 10% increase in tax would lead to only a 1.9% reduction in the consumption of wine and a 4.8% reduction in the consumption of spirits.

For the full WSTA Budget submission (pdf)click here.

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