Fed: Distillers say they don't want collected tax refunded

AAP General News (Australia)
08-29-2008
Fed: Distillers say they don't want collected tax refunded

CANBERRA, Aug 29 AAP - Distillers say they don't want the federal government to return
the $200 million that has been collected so far from a tax hike on alcopops - an amount
the government says is $100 million more.

Prime Minister Kevin Rudd said the industry would be looking for a windfall profit
if the government could not get the Senate to approve its measure to address binge drinking.

The government imposed a tax increase of 70 per cent on ready-to-drink alcoholic beverages
in April, a move that needed to be approved by parliament within a year.

The coalition has indicated it will oppose the tax which the government estimates will
raise about $2 billion, some of which will be spent on programs to address binge drinking.

Mr Rudd said the windfall gain to distillers would be $300 million, which could be
better spent on such things as lifting the number of elective surgery procedures.

"This $300 million so far that we have collected by way of additional tax on this category
of drinks goes straight back to the hand of the distillers rather than going to programs
like that," he said on Fairfax Radio.

"If the Liberals proceed with blocking this in the Senate, as they seem to be doing,
then that $300 million then gets anchored into the back pocket of the distillers because
that's what happens."

But the distillers do not want the money - which they say is $200 million - back.

"Our members do not seek to profit from a situation in which the government is forced
to return tax revenues collected without Senate approval," Distilled Spirits Industry
Council of Australia spokesman Stephen Riden said.

"If and when enabling legislation is rejected by the Senate, all revenue gained from
this poorly conceived tax trial should be returned to the community for use in alcohol-related
harm minimisation programs.

"The $200 million collected to date would make a huge impact if directed towards community-based
education and intervention programs."

Mr Rudd said the government increased the tax - which made ready-to-drinks between
30 cents and $1.30 more expensive - on the advice of health authorities and state police
commissioners.

"We had to act to close a tax loophole on a particular category of drinks where you
saw this explosion in drinking on the part of teenagers in general and teenage girls in
particular," he said.

AAP mb/rl/cjh/bwl

KEYWORD: ALCOPOPS

2008 AAP Information Services Pty Limited (AAP) or its Licensors.