Since 2000, liquor prices have increased by 14 per cent in the Island, while in the UK they have remained in line with inflation – meaning that they have not increased in real terms, according to figures produced by the States Statistics Unit which were published in a pre-budget Scrutiny report.
The report, which was produced by the Corporate Services Scrutiny Panel, notes that between 2004 and 2017 the duty on a bottle of whisky in Jersey increased by 82 per cent, while it went up by 62 per cent on a bottle of wine.
UK duty rises over the same period on the same items were 11 per cent and 21 per cent respectively.
In next week’s budget Treasury Minister Alan Maclean has proposed a 7.5 per cent rise on the price of a packet of cigarettes and a 2.5 per cent – which is in line with inflation –increase on beer and wine.
Panel chairman Deputy John Le Fondré said that the figures were ‘very interesting’ and warranted further research.
‘This report was designed as an exercise to gather data and we haven’t drawn any conclusions from it,’ he said.
‘But we found these points interesting and it is now open for any future Scrutiny panel to investigate.’
The report was carried out to gather data concerning the link between increasing impôts duties on alcohol and cigarettes and benefits to Islanders’ health.
It says that there is a ‘significant weight of evidence’ that increasing taxes on alcohol provides health benefits.
However it adds: ‘Much of this is based on evidence in the USA and none of it is based directly on experience in Jersey.
‘Less evidence has been presented to support the health benefits of tobacco duty increases, although this may be because the link between tobacco consumption and health consequences are generally accepted.’
The report adds that increasing alcohol taxes has a ‘particular’ impact on younger drinkers and ‘binge drinkers’, according to studies carried out at the University of Florida.
‘The impact of such measures seems to be larger in the long run than in the short run and tends to be particularly strong for adolescents and young adults,’ it says.
Meanwhile, as part of a series of budget amendments due to be debated next week, Senator Philip Ozouf has proposed cutting the duty-free allowance for cigarettes from 200 to 40 and proposed that large liquor vendors start paying ten per cent corporation tax.
Both moves would probably further increase costs for drinkers and smokers.
