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Sip and tuck: Tax all alcohol and watch Australians shed the kilos
Australian Financial Review, Australia  by Jill Margo
12 Dec 2018
General News - Page 37 - 1142 words - ID 1049885396 - Photo: Yes - Type: News Item - Size: 634.00cm2


Taxing all alcohol at the rate of 84 per standard drink is the most cost-effective way of reducing obesity in Australia, according to a new analysis of policy options in the fight against obesity.

The analysis - the first to rank obesity policies on value for money - was released on Wednesday by Deakin University in Melbourne.

While an alcohol tax could have a positive impact on broader issues including injury prevention, road accidents and the justice system, this is the first economic model to show it could have a significant positive effect on population weight.

Various types of alcohol are presently taxed differently, but under a uniform volumetric tax all would be taxed on alcohol content, meaning a significant price increase for some products.

A second policy option is to introduce a floor price at $1.30 per standard drink, which occurred in the Northern Territory this year.

The authors of the report acknowledge that public acceptability of such interventions is likely to be low.

After alcohol, they showed the most costeffective measures would be a tax on sugary drinks and a ban on junk food advertising to children.

Assessing Cost-Effectiveness of Obesity Prevention Policies in Australia took six years to complete and looked at 16 obesity prevention interventions.

Shortened to The ACE Obesity Policy 2018, it was produced as part of a National Health and Medical Research Council Centre of Research Excellence grant in Obesity Policy and Food Systems.

It is also the first to evaluate the costeffectiveness of interventions such as restrictions on price promotions of unhealthy foods, supermarket shelf-tags on healthier products, and workplace interventions to reduce sedentary behaviour.

All 16 options were found to offer good value for money, says the lead author, senior research fellow Jaithri Ananthapavan.

"To address the epidemic, we need multiple interventions implemented together because no one intervention is going to solve the problem," she says.

Policies across different settings and engaging different levels of government are needed.

"An alcohol tax alone, for example, would have no impact on childhood obesity," Ananthapavan says. "So we need a combination that impacts the whole environment.

"If the government wants to make obesity prevention a key health priority, this report provides a great road map towards that goal. But successful implementation of obesity prevention policies will ultimately require political courage and commitment."

The findings are timely given that the Council of Australian Governments last month indicated it planned to work towards a national obesity strategy. And last week the Senate Select Committee into the Obesity Epidemic in Australia handed down its findings, with key recommendations including a tax on sugary drinks and a ban on TV junk food advertising.

A uniform tax on alcohol would drive down consumption, producing substantial health gains and healthcare cost-savings, says Associate Professor Gary Sacks, coauthor of the report from Deakin Health Economics.

"Alcohol is high in calories, with a pint of beer almost on par with a chocolate bar, so consumption can have a big impact on daily energy intake," he says.

The report estimates the 84 tax would cost $32 million to implement, increasing the price of off-premise beer and wine by an average of 29 per cent, and cask wine by 121 per cent. It would lead to a 16 per cent reduction in mean alcohol consumption and a 0.7 kilogram reduction in mean population body weight.

The $1.30 floor price option is estimated to cost $30 million to implement and would largely not affect the price of on-premise alcohol, but would increase the price of some off-premise alcohol - wine by 14 per cent and cask wine by 168 per cent.

It would lead to a 9 per cent decrease in mean alcohol consumption and 0.45 kilogram reduction in mean population body weight.

It is surprising that no previous reports on obesity prevention mentioned the costeffectiveness of alcohol, associate professor Sacks says.

"When WHO puts out reports with long lists of things governments should do for obesity, this option hasn't come up, which probably reflects the silos within health.

"If you work in obesity, you look at food and if you look at alcohol, you just look at that. So, this is the first time the two areas of health have come together."

The report is also the first to evaluate the cost-effectiveness of interventions such as restrictions on price promotions of unhealthy foods, supermarket shelf-tags on healthier products and workplace interventions. Price promotions refer to supermarket weekly specials on junk food.

"We looked at what would happen if these foods couldn't go on special," Sacks says. "People are really responsive to change in price and if we got rid of those specials it would make a difference to obesity levels.

This wouldn't be a costly intervention."

Ananthapavan says the report considers important factors such as ensuring policies don't unfairly harm vulnerable population groups, the strength of evidence for an intervention, its acceptability by the public, the feasibility of implementing it, and its long-term sustainability.

"Taxation-based policies are highly costeffective," she says. "However, we know that they are likely to be unpopular, so we also looked at 13 non-taxation based policies in our report and found they all represented good value for money too."

Australia's alarming overweight and obesity rates - 63 per cent of adults and 27 per cent of children - will only be addressed through multiple interventions together.

Australia's obesity epidemic costs more than $12 billion a year in medical costs and lost productivity, and can only be addressed through a comprehensive societal response.

The budget for prevention efforts is only 1.34 per cent of Australia's health expenditure, much less than countries such as Canada, the UK and New Zealand.

"Within this limited budget, governments need to prioritise which interventions to fund. It's therefore critical we build reliable evidence on the costs and benefits of various policy options," Ananthapavan says.

Other options include community interventions, financial incentives for weight loss by private health insurers, a fuel excise increase of 10 per litre, menu kilojoule labelling on fast food, a national media campaign on sugar-sweetened beverages, reformulating the Health Star Rating nutrition-labelling system, restricting TV advertising of unhealthy foods, restricting price promotions of sugarsweetened beverages, reducing sedentary behaviour and/or increasing physical activity at school, having a package size-cap on sugar-sweetened beverages, and reducing sugar content in sugar-sweetened beverages.

What does the alcohol industry think of the policy options?

"If people are drinking in moderation as part of a balanced lifestyle, alcohol shouldn't cause them any weight problems," says Fergus Taylor, executive director of Alcohol Beverages Australia. AFR Jill Margo is an adjunct associate professor at the University of NSW.

Caption Text:
A pint of beer is almost as high in calories as a chocolate bar, so a uniform alcohol tax could have a big effect on obesity, say Jaithri Ananthapavan and Gary Sacks from Deakin University.

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