Minister tables Bill to simplify alcohol levy regime

A new Bill detailing proposals to simplify the way the Alcohol Advisory Council levy is calculated was tabled in Parliament today by Associate Health Minister Damien O'Connor.

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A new Bill detailing proposals to simplify the way the Alcohol Advisory Council levy is calculated was tabled in Parliament today by Associate Health Minister Damien O'Connor.

"The Alcohol Advisory Council Amendment Bill will see separate levies retained for different alcoholic beverages but current categories will be replaced with a system based on alcohol classification bands. Alcoholic beverages with a higher volume of alcohol will contribute a higher proportion to the levy," said Mr O'Connor.

The Alcohol Advisory Council (ALAC) levy is used to fund the activities of ALAC whose objective it is to promote moderation in the use of alcohol, discourage and reduce the misuse of alcohol and minimise harm resulting from the misuse of alcohol.

Mr O'Connor said the Ministry of Health conducted a thorough review of the provisions and found the current levy-setting mechanisms were outdated and overly complex.

"The revised levy-setting provisions for the ALAC levy shouldn't affect the price that consumers currently pay for alcoholic beverages but may influence the proportion that each type of alcoholic beverage contributes towards the ALAC levy.

"The proposed regime is up-to-date and simple to calculate. It is also future proofed against the emergence of new types of beverages that would not easily fit into one type of liquor class as in the current system," said Mr O'Connor.

The levy is calculated separately from alcohol excise and is significantly smaller.
It amounted to approximately $11.4 million in 2006 compared to almost $750 million in excise in 2006. Excise and levy years have now been aligned to 1 July.

Once the Bill is passed, the new levy rates will continue to be published in the New Zealand Gazette in a timely manner in order to provide industry groups with a sufficient notification period before the new levy rates come into effect each year.