Alcohol Taxation and Regulation in the European Union
AbstractThis paper estimates the external costs of harmful alcohol use in the European Union (EU) and confronts them with the alcohol excise duty collections per adult and per litre of pure alcohol in the various Member States. In all but one Member State, drinkers do not appear to pay their way. This reflects the EU’s acquiescence in a formidable alcohol problem. Fifteen per cent of adults ‘drink too much’, while the extent of youth drinking has reached alarming proportions. The external costs should be internalised in price through an appropriate optimal alcohol excise duty, supplemented by regulatory measures aimed at specific problem groups. Further, a coordinated alcohol tax policy seems called for, which would, among others, raise the minimum duties on wine, beer and spirits, preferably in line with their relative alcohol content. A drawback of these measures is that they would reduce the welfare of moderate drinkers.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1821.
Date of creation: 2006
Date of revision:
alcohol taxation; European Union; external costs; social costs;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-11-18 (All new papers)
- NEP-EEC-2006-11-18 (European Economics)
- NEP-HEA-2006-11-18 (Health Economics)
- NEP-PBE-2006-11-18 (Public Economics)
- NEP-PUB-2006-11-18 (Public Finance)
- NEP-REG-2006-11-18 (Regulation)
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