Increasing the Price of Alcohol as an Obesity Prevention Measure: The Potential Cost-Effectiveness of Introducing a Uniform Volumetric Tax and a Minimum Floor Price on Alcohol in Australia.

Ella Robinson,Gary Sacks,Anita Lal,Jaithri Ananthapavan,Phuong Nguyen,Heng Jiang,Michael Livingston

doi:10.3390/nu12030603

Ella Robinson, Gary Sacks + Show 5 more

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https://doi.org/10.3390/nu12030603

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Abstract

The objective of this study was to estimate, from an obesity prevention perspective, the cost-effectiveness of two potential policies that increase the price of alcohol in Australia: a volumetric tax applied to all alcohol (Intervention 1) and a minimum unit floor price (Intervention 2). Estimated changes in alcoholic drink consumption and corresponding changes in energy intake were calculated using the 2011–12 Australian Health Survey data, published price elasticities, and nutrition information. The incremental changes in body mass index (BMI), BMI-related disease outcomes, healthcare costs, and Health Adjusted Life Years (HALYs) were estimated using a validated model. Costs associated with each intervention were estimated for government and industry. Both interventions were estimated to lead to reductions in mean alcohol consumption (Intervention 1: 20.7% (95% Uncertainty Interval (UI): 20.2% to 21.1%); Intervention 2: 9.2% (95% UI: 8.9% to 9.6%)); reductions in mean population body weight (Intervention 1: 0.9 kg (95% UI: 0.84 to 0.96); Intervention 2: 0.45 kg (95% UI: 0.42 to 0.48)); HALYs gained (Intervention 1: 566,648 (95% UI: 497,431 to 647,262); Intervention 2: 317,653 (95% UI: 276,334 to 361,573)); and healthcare cost savings (Intervention 1: $5.8 billion (B) (95% UI: $5.1B to $6.6B); Intervention 2: $3.3B (95% UI: $2.9B to $3.7B)). Intervention costs were estimated as $24M for Intervention 1 and $30M for Intervention 2. Both interventions were dominant, resulting in health gains and cost savings. Increasing the price of alcohol is likely to be cost-effective from an obesity prevention perspective in the Australian context, provided consumers substitute alcoholic beverages with low or no kilojoule alternatives.

Highlights

The World Health Organization (WHO) recommends fiscal policies to restrict the consumption of unhealthy foods and drinks as part of a suite of measures to address overweight and obesity globally [1].Over the past several years, a growing number of countries and jurisdictions have introduced fiscal policies to help curb rising obesity rates, primarily focused on taxes on sugar-sweetened beveragesNutrients 2020, 12, 603; doi:10.3390/nu12030603 www.mdpi.com/journal/nutrients (SSBs), which are a risk factor for obesity and obesity-related conditions including diabetes, several cancers, and cardiovascular disease [2]
Whilst alcoholic beverages are typically high in kilojoules [3], the taxation of alcohol has not been a focus of obesity prevention efforts [4]
This study aimed to model the potential cost-effectiveness, from an obesity prevention perspective, of two potential pricing interventions designed to increase the price of alcohol in Australia: a uniform volumetric tax and a minimum unit floor price

Summary

Introduction

Over the past several years, a growing number of countries and jurisdictions have introduced fiscal policies to help curb rising obesity rates, primarily focused on taxes on sugar-sweetened beverages. The taxation of alcoholic beverages is commonplace globally as a way to generate government revenue and prevent the significant harms associated with alcohol [5]. Alcohol is a risk factor for a number of chronic conditions as well as a major contributor to accidents, injuries, violence, crime, mental and behavioral disorders and alcohol dependence [6,7]. In countries like Australia, the current system for the taxation of alcohol does not adequately address the negative externalities associated with alcohol [8]

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