Review slams alcohol hard

The review proposes to close the gap between tax from liquor and the cost of alcohol-related health services. Photo / Dean Purcell

The excise tax on alcohol should be increased because drinkers and the liquor industry are not paying enough towards the social cost of liquor consumption, says Law Commission president Sir Geoffrey Palmer.

Raising the drinking age, reducing the driving limit and restricting opening hours and advertising are also options suggested by Sir Geoffrey, who is part-way through a review of liquor laws.

Sir Geoffrey said the commission would be recommending significant change.

He said an "alcohol harm reduction act" should be passed, and outlined a "trial balloon" of its options.

The excise tax could be increased so "those who drink the most pay the most tax".

Sir Geoffrey did not specify how much the tax should be increased, but pointed out the $4.4 billion gap between the excise tax take of $795 million and the estimated $5.296 billion social cost of alcohol each year.

The $5.296 billion estimate was made in a recent study by forecast agency Berl for the Ministry of Health and ACC. It covers the costs of alcohol in terms of crime and healthcare.

Sir Geoffrey said these costs should be carried by the liquor industry, rather than from general taxation.

"It does seem to me that the taxpayer should not be asked to shoulder as much of the burden as is currently being met from public funds."

It was often argued that lifting the excise tax would "penalise everyone" but it would hit the heaviest drinkers.

Sir Geoffrey said there was also a strong case for increasing the drinking age to 19 or 20.

He said the opening hours of liquor shops could also be limited, as moves to 24-hour trading were not helping the problems with alcohol. Bar opening hours could also be restricted.

"I do not understand why bars need to be open until 6am on a Sunday morning," he said.

Another possibility was regulating alcohol advertising, particularly at the point of sale.

And he sided with police on reducing the adult breath-alcohol driving limit to 50mg per 100ml from 80mg per 100ml.

The review was ordered by the Labour Government after the shooting of Navtej Singh during a robbery at his Manurewa liquor store last June.

National Justice Minister Simon Power has emphasised the problems alcohol is causing, and asked the commission to speed up its work.

Sir Geoffrey said the commission would issue a public discussion paper in July. He said a police national alcohol assessment contained "distressing figures".

Police were acting as "nursemaid" to drunks, and the law needed to be adjusted so their resources were not wasted on activities that were readily preventable.

Hospitality Association chief executive Bruce Robertson said an increase in the excise tax would not address the problem of under-age drinking or people drinking too much.

Associate Health Minister Peter Dunne said the Law Commission's proposals were "useful feedback" but were not Government policy and "no one should leap to any conclusions".

HITTING THE BOTTLE

Drinking age
Now: 18
To be: 19 or 20

Excise tax rate on alcohol
Now: 33c on a 330ml stubbie of Lion Red, $1.86 on a bottle of wine.
To be: More, to cover "substantial gap" between the tax take and social costs.

Opening hours
Now: Bars and shops allowed up to 24 hours, but there are local restrictions
To be: "No reason for bars to be open to 6am on Sunday morning"

Driving limit
Now: 80mg per 100ml
To be: 50mg per 100ml

Driving limit for under 20s
Now: 30 milligrams for every 100ml
To be: Zero - no alcohol at all