Percentage

Identifying the burden of excise tax on the price of the most sold brand of beer, the most sold brand of the most sold type of spirits, and the internationally comparable brand of sugar-sweetened carbonated beverages

Amongst the different types of consumption taxes, excise taxes are preferred from a public health perspective as they can be used to raise the relative price of alcoholic and non-alcoholic beverages compared to other products and services in the economy, participating in reducing their affordability.

There are different types of excise taxes applicable to alcoholic and non-alcoholic beverages:

For alcoholic beverages:

- Volumetric (unitary) specific excise: is a tax on a selected beverage produced for sale within a country or imported and sold in that country. This tax comes in the form of an amount in currency applied to a certain volume of the beverage, per litre, per 100 ml, or per fluid ounce. Example: $ 1.00 per litre.

- Alcohol-content-based specific excise: is a tax applied on an alcoholic product produced for sale within a country or imported and sold in that country. This tax comes in the form of an amount in currency applied proportionate to the alcohol concentration of a beverage, per litre of pure alcohol, per gram of ethanol, or per alcohol by volume. Example: $ 10.00 per litre of pure alcohol.

- Ad valorem excise: is a tax on a selected beverage produced for sale within a country or imported and sold in that country. This tax comes in the form of a percentage of the value of a transaction between two independent entities at some point in the production/distribution chain; ad valorem taxes are generally applied to the value of the transactions between the manufacturer and the retailer/wholesaler. Example: 10% of the producer/manufacturer’s price.

For non-alcoholic beverages:

- Volume-based specific excise: is a tax on a selected beverage produced for sale within a country or imported and sold in that country. This tax comes in the form of an amount in currency applied to a certain volume of the beverage, per litre, per 100 ml, or per fluid ounce. Example: $ 1.00 per litre.

-Sugar-content-based specific excise: is a tax on a selected beverage produced for sale within a country or imported and sold in that country. This tax comes in the form of an amount in currency applied proportionately to the sugar content of a beverage, per gram of sugar, per gram of sugar per litre, or per gram of sugar per 100 ml. Example: $ 0.10 per gram of sugar per 100 ml.

- Ad valorem excise: is a tax on a selected beverage produced for sale within a country or imported and sold in that country. This tax comes in the form of a percentage of the value of a transaction between two independent entities at some point in the production/distribution chain; ad valorem taxes are generally applied to the value of the transactions between the manufacturer and the retailer/wholesaler. Example: 10% of the producer/manufacturer’s price.

Some countries apply a combination of those taxes and the structure is therefore mixed.

Total excise tax is the sum of all the different types of excises applied to an alcoholic and non-alcoholic product in a country.

Volumetric (unitary) specific excise

Alcohol-content-based specific excise

Volume-based specific excise

Sugar-content-based specific excise

Ad valorem excise

Total excise tax

• Beer
• Spirits
• Sugar-sweetened carbonated beverage

Excise tax rates reported were converted as a percent of the prices reported for

330 ml of the most sold brand of beer

750 ml of the most sold brand of most sold type of spirits

330 ml of the internationally comparable brand of sugar-sweetened carbonated beverages.

Biennial

Biennial

perucica@who.int

Anne-Marie Perucic

7753

Percentages depend in many cases (especially when excise is specific) on the level of price reported for each beverage. If the price is not correctly reported, the proportion estimated may be biased.