Alcohol plan 'may boost industry'

AlcoholGovernment plans to impose a minimum unit price for alcohol could bring an £850 million-a-year windfall for the drinks industry, a leading economic think-tank has said.

The Institute for Fiscal Studies (IFS) said the proposals, unveiled last week in an attempt to curb binge drinking in England and Wales, would have a "significant impact" for off-licence sales of alcohol.
But it suggested ministers would be better off introducing a "floor price" for alcohol through the duty system, which would see the extra revenue go to the Exchequer rather than the industry.

Although the Government's alcohol strategy document says it would work with industry to ensure the revenue generated was used to provide "better value to customers in other areas", the IFS said it was "hard to see" how this could be enforced or monitored.

Overall, the IFS calculated that almost half the units of alcohol sold off-licence in shops and supermarkets - 47% - would be affected by the Government's suggested minimum price of 40p a unit.

However, there were substantial differences across the various alcohol types, with 80% of cider units currently sold being directly affected while alcopops and sparkling wine - where most units already cost more than 40p - would see little change.

The IFS said the heaviest drinkers on low incomes would be most affected - adding 5.9% to the average grocery bill of someone drinking more than 35 units a week and with an income of less than £10,000-a-year.

Moderate consumers would also be "quite substantially affected", with just 37% of the units bought by those drinking less seven units a week unaffected by a 40p minimum, compared to 59% for those drinking more than 35 units a week.
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