Tourism industry not consulted over booze tax rises

Tuesday 08 November 2016

Treasury Minister Alan Maclean yesterday admitted that the tourism industry was not consulted over the recent proposed inflation-busting rises in alcohol taxes.

Rises in tax on wine, liqueurs and beer are all set to be around the 5% mark. A pint of beer under 4.9% alcohol by volume (ABV) will receive a 5.44% rise per pint, whereas under 4.9% ABV it will be 4.76%.

Wine will go up 5.18% per bottle and spirits 4.96% per litre. 

Senator Maclean was speaking to the Corporate Services Scrutiny Panel about Budget 2017, which will be debated by the States in mid-December.

Panel Member, Deputy Simon Bree said: “Looking at the proposed increases in duty, did you take into account the potential impact this would have on the tourism and hospitality industries in Jersey?

Senator Maclean said: “Yes of course, when making any changes we do give consideration to all the issues.”

Deputy Bree then asked: “Did you consult with the tourism industry at all, prior to proposing this increase in alcohol duty?”

“We did not consult with them beforehand, no,” replied the Treasury Minister.

Deputy Bree asked for the justification for the proposed duty rises, saying: “What is the reason for increasing the duty on alcohol above the cost of living?”

The Treasury Minister replied: “It is largely to do with policies we have adopted and in this case it is largely to do with health. It will come as no surprise that alcohol, taken in inappropriate quantities, is detrimental to health and for that reason we have increased alcohol duties.”

Deputy Bree said: “And yet the actual rate of alcohol consumption is increasing despite the fact there have been rises in duty payable over a great number of years. Is this strategy of increasing duty on alcohol to effectively reduce consumption actually failing?”    

“No I don’t think it is,” said Senator Maclean. “It is interesting because where we have been more aggressive in recent years, in terms of duties on spirits and higher strength alcohol, we have seen statistically that consumption has reduced quite considerably.  

“Consumption of beer has also fallen in that period, wine has broadly levelled out, whereas we have seen an increase in cider, which in terms of local cider production is clearly a good thing for the economy. There seems to have been a shift in drinking habits in that area.”

Senator Sarah Ferguson said the proposed price hike will be especially felt by pensioners who enjoy the occasional tipple.

She said: “A lot of pensioners are at the bottom end of the earning scale and they are going to be hit hard by these increases. There is no justification for doing it. Also, changing people’s behaviour, is that the job of Government? That’s a bit of a socialist point of view. I thought we were all about reducing the size of Government.”