Modelling the effects of alcohol pricing policies on alcohol consumption in subpopulations in Australia

Aims: To model the effects of a range of alcohol pricing policies on alcohol consumption in subpopulation groups (e.g. alcohol consumption pattern, and age and income groups) in Australia. Design: We used estimated price elasticities to model the effects of proposed pricing policies on consumption for 11 beverage categories among subpopulation groups. Setting: Australia. Participants: A total of 1789 adults (16+ years) who reported they purchased and consumed alcohol in the 2013 Australian International Alcohol Control Study, an adult population survey. Measurements: Mean and percentage changes in alcohol consumption were estimated for each scenario across subgroups. The policy scenarios evaluated included: (1) increasing the excise rate 10% for all off-premise beverages; (2) replacing the wine equalization tax with a volumetric excise rate equal to the current spirits tax rate; (3) applying a uniform excise tax rate to all beverages equal to the current sprits tax rate and a 10 or 20% increase in it; and(4) introducing a minimum unit price (MUP) on all beverages categories at $1.00, 1.30 or 1.50. Findings: The effects of different tax and MUP policies varied greatly across different subgroups. The effects of the MUP policy on alcohol consumption increased rapidly in the range from $1.00 to $1.50. Applying a uniform tax rate across all beverages equal to current spirits tax rate, or a 10 or 20% increase beyond that, could generate large reductions in overall alcohol consumption in Australia. Compared with the uniform tax rate with or without further tax increase, introducing a MUP at $1.30 or $1.50 could reduce consumption particularly among harmful drinkers and lower-income drinkers, with comparatively smaller impacts on moderate and higher-income drinkers. Conclusions: Both uniform excise tax and minimum unit price policies are predicted to reduce alcohol consumption in Australia. Minimum unit price policies are predicted to have a greater impact on drinking among harmful drinkers than moderate drinkers.