LABOUR AND TORIES LEFT RED-FACED BY DUMPING OF CIDER TAX

LABOUR AND TORIES LEFT RED-FACED BY DUMPING OF CIDER TAX

TAXATION ‘INEFFECTIVE’ FOR CONTROLLING DRINK CONSUMPTION

The Tories and Labour in Scotland have been left red-faced after they rushed to claim that the cider tax announced in the budget would “overtake” the Scottish Government’s plans for minimum pricing – just days before it was promptly dumped in the pre-election ‘wash-up’ period at Westminster.

SNP MSP for Falkirk West Michael Matheson has also released figures from Tennent’s, which show that tax is an ineffective method of controlling sales of cheap drink and that only a minimum price per unit can be guaranteed to produce an end-cost which is anywhere near what is required to bring about a meaningful reduction in consumption amongst harmful drinkers.

Mr Matheson, a member of Holyrood’s Health and Sport Committee, said:
“Both Labour and the Tories have been left looking foolish by Alistair Darling’s 14 day wonder cider tax. No sooner have they made ludicrous claims that this would be more effective at combating the destructive effects of cheap drink than the SNP’s properly evidenced minimum pricing policy, than he goes and dumps it anyway.

“Even before it was dropped, the public health potential of the cider tax was highly questionable. It was quickly rubbished by Magner’s announcement that they would absorb the tax themselves.

“The fact is that a taxation-based system that would bring only negligible price changes cannot bring about an end to flood of cheap alcohol available in Scotland.

"It was always simply laughable for Jackie Baillie and Murdo Fraser to claim that minor duty increases would have more of an impact than the Scottish Government’s widely-supported minimum pricing policy. Did they really think that people will consume less cider because the price has increased from £1.20 to £1.32? This is equivalent to a minimum price of just 15p per unit.

"Similarly, a ban on below duty sales, or even below duty plus VAT, has almost no impact on the cost to consumers of a can of Tennent's lager. Tennent's themselves recognise this - that's why they support minimum pricing and are calling on all parties to play their part and take the strong action that is needed.

"The fact is, those who drink irresponsibly favour the ultra-cheap alcohol - whatever kind it is. It is simply unacceptable for supermarkets to be - in some cases - selling alcohol more cheaply than water.

“When will Jackie Baillie and her colleagues listen to this overwhelming evidence presented by SHAAP and supported by the BMA, all four UK Chief Medical Officers, all NHS boards, the police, licensing boards, and Tennent's, and realise that minimum pricing is the only effective way to end cheap alcohol in Scotland once and for all?"

1. Press coverage of Labour and Tories welcoming the cider tax and calling on the Scottish Government to drop minimum pricing plans http://www.pressandjournal.co.uk/Article.aspx/1662068?UserKey=

2. Figures showing the marginal price difference the cider tax would have made sourced from Scottish Health Action on Alcohol Problems (SHAAP) http://www.pressandjournal.co.uk/Article.aspx/1673555?UserKey=

3. Magners announced that they would absorb the price increase themselves http://www.morningadvertiser.co.uk/news.ma/article/86480

4. The following figures show the difference in price of Tennent's Lager, comparing prices under systems based on duty, duty plus VAT, duty plus 25% plus VAT, and a minimum price of 40p and 50p.

Minimum Pricing v Duty Based

Using Tennent's Lager 4% ABV 12 x 440ml as the example

Duty Add VAT Duty plus 25% plus VAT Minimum Pricing

£ £ 40p 50p


per hectolitre 65.88

per litre 0.6588

per 440ml 0.2899 0.341 0.426 0.704 0.88

per 12x440ml 3.479 4.088 £5.11 £8.45 £10.56

per 24x440ml 6.958 8.176 £10.22 £16.90 £21.12


Christmas Pricing in many Supermarkets: 3 cases for £20. Equiv. price for 12x440ml = £6.66.