Alcohol industry says new taxes won't cut youth drinking

12.25pm

New taxes on alcohol to discourage young people from drinking have missed the liquor products most popular with that age group, liquor retailers said today.

Liquor King's Wellington business development manager Shane Elers said it was an "absolute shock" that ready-to-drink (RTD) and alco-pops were not targeted in the new legislation.

"The RTDs, which I would have thought was the key one (drink) haven't been touched (by the Bill), yet," he told NZPA.

Colleagues he had spoken with held the same view, Mr Elers said.

Early this morning the Government passed the Customs and Excise (Alcoholic Beverages) Amendment Bill, imposing a 2.6 per cent excise increase on all alcohol in line with consumers' price index (CPI) movements.

The legislation also means alcoholic beverages in the 14-23 per cent alcohol by volume range will be taxed according to their actual alcohol content.

But RTDs and alco-pops have an alcohol content of about 5 per cent.

Products in the 14-23 per cent alcohol by volume bracket and above were generally less popular with young people: "They certainly don't buy sherries," Mr Elers said.

Spirits such as gin and whisky will not be affected by the extra taxes, only by the CPI increase. However, the excise tax on cream liquors, sherries and fortified wines will rise when the increase comes into effect on June 1.

Liquorland Miramar acting manager Shane Matene said no matter what alcohol cost, young people would "scrape together" the money to buy it.

He expected the Bill would have some effect, possibly for about a month, on young people's alcohol buying habits.

"It's just going to make people a little more desperate to find money," he told NZPA today, noting young people tended not to buy more expensive alcoholic drinks like gin or whiskey.

Beer, Wine and Spirits Council chief executive Nicki Stewart said she was surprised the Bill did not cover RTDs.

"If the reason behind this is to reduce alcohol-related harm with youth drinking abuse, then wouldn't you target the drinks that they are drinking," Ms Stewart said.

New Zealand First MP Ron Mark said he refused to accept the move would tackle teenage drinking because alco-pops were not included.

"Everyone knows that alco-pops, designed for convenience and targeted at a youth audience, are the real problem," he said in a statement today.

If the Government seriously wanted to modify the drinking habits of teenagers it would raise the drinking age back to 20 and strictly police the laws, he said.

Alcohol Healthwatch director Rebecca Williams said it was a "shame" that drinks popular with young people had not been picked up by the Bill.

"The taxation system... can't pick up the subtleties of the drinks that different population groups are attracted to, unfortunately," she said.

The New Zealand Drug Foundation spokeswoman Sally Jackson said the price of alco-pops needed to be taken out of "pocket money" range.

The foundation supported the excise increases, but said the move did not go far enough, she said in a statement.

"Pricing policy, through excise taxes on alcohol, is recognised internationally as one of the most effective tools, as price affects consumption levels," Ms Jackson said.

The Government has estimated that on current consumption levels, the increase in excise duty would bring in about $18 million in the 2003/04 year.

The increases would add an extra $4.45 to 750ml bottles and an extra $6.65 to 1125ml bottles of light spirits.

- NZPA