• Joshua M Byrnes, Linda J Cobiac, Christopher M Doran, Theo Vos, and Anthony P Shakeshaft.
• National Drug and Alcohol Research Centre, University of New South Wales, Sydney, NSW, Australia. z3229463@student.unsw.edu.au
• Med. J. Aust. 2010 Apr 19; 192 (8): 439-43.

ObjectiveTo estimate the potential health benefits and cost savings of an alcohol tax rate that applies equally to all alcoholic beverages based on their alcohol content (volumetric tax) and to compare the cost savings with the cost of implementation.Design And SettingMathematical modelling of three scenarios of volumetric alcohol taxation for the population of Australia: (i) no change in deadweight loss, (ii) no change in tax revenue, and (iii) all alcoholic beverages taxed at the same rate as spirits.Main Outcome MeasuresEstimated change in alcohol consumption, tax revenue and health benefit.ResultsThe estimated cost of changing to a volumetric tax rate is $18 million. A volumetric tax that is deadweight loss-neutral would increase the cost of beer and wine and reduce the cost of spirits, resulting in an estimated annual increase in taxation revenue of $492 million and a 2.77% reduction in annual consumption of pure alcohol. The estimated net health gain would be 21 000 disability-adjusted life-years (DALYs), with potential cost offsets of $110 million per annum. A tax revenue-neutral scenario would result in an 0.05% decrease in consumption, and a tax on all alcohol at a spirits rate would reduce consumption by 23.85% and increase revenue by $3094 million [corrected]. All volumetric tax scenarios would provide greater health benefits and cost savings to the health sector than the existing taxation system, based on current understandings of alcohol-related health effects.ConclusionsAn equalized volumetric tax that would reduce beer and wine consumption while increasing the consumption of spirits would need to be approached with caution. Further research is required to examine whether alcohol-related health effects vary by type of alcoholic beverage independent of the amount of alcohol consumed to provide a strong evidence platform for alcohol taxation policies.

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