The impact of alcohol tax elimination policy on population health in Hong Kong

Abstract

Background: Extensive research has shown that taxes on alcohol reduces consumption and alcohol-related harm. Uniquely among high-income economies, the Hong Kong Government reduced alcohol taxes on wine and beer by half in 2007; and entirely waived all alcohol-related taxes in 2008.

Methods: We adapted the International Model of Alcohol Harms and Policies (InterMAHP) using Hong Kong data to evaluate the health impact of the tax elimination policy changes on alcohol pricing. Prevalence and consumption estimates were calculated from serial Behavioural Risk Factor surveys of health behaviours among the Hong Kong population. We applied the linear approximation of the Almost Ideal Demand System (AIDS) econometric model to estimate the elasticity of demand for on-trade and off-trade sales of alcohol (beer, wine, and spirits) using Euromonitor market sales data. We derived population attributable fractions and relative risks estimates from Hospital Authority morbidity and mortality records.

Results: Alcohol consumption and alcohol-related harms were higher for males. We found the policy change increased alcohol-attributable mortalities, predominately due to increases in cancer, cardiovascular disease, and injuries. The burden of disease was higher in older age groups.

Conclusions: Hong Kong pursued a policy of eliminating taxes on alcohol despite extensive evidence on the effectiveness of taxation as a policy tool. We find empirical evidence this policy change was associated with an increase in alcohol-related harms and detrimental to population health.

Key messages The alcohol tax elimination policy in Hong Kong was associated with an increase in alcohol-related burden of disease. Reintroduction of alcohol taxes merits consideration.