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. 2020 Jun;40(5-6):153-164.
doi: 10.24095/hpcdp.40.5/6.04.

How many alcohol-attributable deaths and hospital admissions could be prevented by alternative pricing and taxation policies? Modelling impacts on alcohol consumption, revenues and related harms in Canada

[Article in English, French]
Tim Stockwell  1 , Samuel Churchill  1 , Adam Sherk  1 , Justin Sorge  1 , Paul Gruenewald  2
Affiliations

How many alcohol-attributable deaths and hospital admissions could be prevented by alternative pricing and taxation policies? Modelling impacts on alcohol consumption, revenues and related harms in Canada

[Article in English, French]
Tim Stockwell et al. Health Promot Chronic Dis Prev Can. 2020 Jun.

Abstract
in English, French

Introduction: In 2017, Canada increased alcohol excise taxes for the first time in over three decades. In this article, we describe a model to estimate various effects of additional tax and price policies that are predicted to improve health outcomes.

Methods: We obtained alcohol sales and taxation data for 2016/17 for all Canadian jurisdictions from Statistics Canada and product-level sales data for British Columbia. We modelled effects of alternative price and tax policies - revenue-neutral taxes, inflation-adjusted taxes and minimum unit prices (MUPs) - on consumption, revenues and harms. We used published price elasticities to estimate impacts on consumption and revenue and the International Model for Alcohol Harms and Policies (InterMAHP) to estimate impacts on alcohol-attributable mortality and morbidity.

Results: Other things being equal, revenue-neutral alcohol volumetric taxes (AVT) would have minimal influence on overall alcohol consumption and related harms. Inflation-adjusted AVT would result in 3.83% less consumption, 329 fewer deaths and 3762 fewer hospital admissions. A MUP of $1.75 per standard drink (equal to 17.05mL ethanol) would have reduced consumption by 8.68% in 2016, which in turn would have reduced the number of deaths by 732 and the number of hospitalizations by 8329 that year. Indexing alcohol excise taxes between 1991/92 and 2016/17 would have resulted in the federal government gaining approximately $10.97 billion. We estimated this could have prevented 4000-5400 deaths and 43 000-56 000 hospitalizations.

Conclusion: Improved public health outcomes would be made possible by (1) increasing alcohol excise tax rates across all beverages to compensate for past failures to index rates, and (2) setting a MUP of at least $1.75 per standard drink. While reducing alcohol-caused harms, these tax policies would have the added benefit of increasing federal government revenues.

Introduction: En 2017, le Canada a augmenté les taxes d’accise sur l’alcool pour la première fois depuis plus de 30 ans. Dans cet article, nous offrons un modèle permettant d’estimer les divers effets de politiques augmentant les taxes et les prix dans le but d’améliorer les résultats en matière de santé.

Méthodologie: Nous avons obtenu de Statistique Canada les données 2016­2017 sur les ventes de boissons alcoolisées et leur taxation dans l’ensemble des provinces et des territoires au Canada, ainsi que les données sur les ventes par produit en ColombieBritannique. Nous avons modélisé les effets de diverses politiques fiscales et d’établissement des prix ‒ taxes sans incidence sur les recettes gouvernementales, taxes corrigées en fonction de l’inflation et d’un prix unitaire minimum (PUM) ‒ sur la consommation, les revenus et les méfaits. Nous avons utilisé les élasticités de prix publiées pour estimer les effets sur la consommation et les revenus, et le modèle international en matière de méfaits et de politiques liés à l’alcool (InterMAHP) pour estimer les effets sur la mortalité et la morbidité attribuables à l’alcool.

Résultats: Toutes choses égales par ailleurs, les taxes volumétriques sur l’alcool (TVA) sans incidence sur les recettes gouvernementales auraient eu une influence minime sur la consommation globale d’alcool et les méfaits qui y sont liés. Les TVA corrigées en fonction de l’inflation auraient entraîné une baisse de 3,83 % de la consommation, ce qui se serait accompagné d’une réduction du nombre des décès de 329 et une diminution du nombre d’admissions à l’hôpital de 3762. En 2016, un prix unitaire minimum de 1,75 $ par verre standard (soit 17,05 ml d’éthanol) aurait permis de réduire la consommation de 8,68 %, ce qui aurait conduit à une diminution du nombre de décès de 732 et du nombre d’hospitalisations de 8 329. Indexer les taxes d’accise sur l’alcool entre 1991­ 1992 et 2016­2017 aurait fait gagner au gouvernement fédéral environ 10,97 milliards de dollars supplémentaires. Selon nos estimations, la situation aurait permis d’éviter entre 4000 et 5400 décès de plus et entre 43000 et 56000 hospitalisations supplémentaires.

Conclusion: L’amélioration des résultats en matière de santé publique aurait été possible grâce à (1) l’augmentation des taux de la taxe d’accise sur l’alcool pour toutes les boissons afin de compenser la non­indexation passée des taux et (2) la fixation d’un PUM d’au moins 1,75 $ par verre standard. La mise en œuvre de ces politiques permettrait aujourd’hui de réduire les méfaits dus à l’alcool tout en augmentant les recettes fédérales.

Keywords: InterMAHP; International Model for Alcohol Harms and Policies; alcohol policy; minimum unit pricing; morbidity; mortality; policy modeling; taxation.

Plain language summary

We modelled the impacts of alternative pricing and taxation policies on alcohol harms for Canada in 2016. A minimum unit price (MUP) of $1.75 per standard drink would have reduced the number of deaths across Canada in 2016 by 732 and hospitalizations by 8329. Compensating for past failures to adjust alcohol excise tax rates with inflation would have decreased the annual number of deaths by 329 and hospitalizations by 3762. Indexing alcohol excise taxes between 1991 and 2017 would resulted in the federal government gaining approximately $10.97 billion. Excise taxes calculated per unit of alcohol, adjusted for inflation and combined with an MUP, would have significantly reduced alcohol consumption, and consequently alcohol-attributable deaths and hospitalizations.

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Conflict of interest statement

TS, JS and AS have each received travel expenses from Scandanavian government alcohol retail monopolies (Systembolaget and/or Alko) to take part in a project to assess the publich health impacts of their policies. TS also received a consulting fee for this work, and AS and JS salary contributions. No conflict for others to declare.

Figures

Figure 1
Figure 1. Probability distributions of ethanol sales by price per standard drink for three product-level samples from British Columbia (BC), 2014–2016
Figure 2
Figure 2. Change in consumption by scenario, beverage category (beer, wine, spirits) and quality group (low, medium, high)
See this image and copyright information in PMC

References

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    1. Thomas G, Stockwell T, Geisbrecht AW, Bosma LM, Giesbrecht N, Bosma LM, et al. American Public Health Association. Washington(DC): 2017. The role of public health research and knowledge translation in advancing alcohol minimum pricing policy in Canada.
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