A narrative review of alcohol control policies in Latvia between 1990 and 2020

The Impact of Raising Alcohol Taxes on Government Tax Revenue: Insights from Five European Countries

BACKGROUND AND OBJECTIVE

Reducing the affordability of alcoholic beverages by increasing alcohol excise taxation can lead to a reduction in alcohol consumption but the impact on government alcohol excise tax revenue is poorly understood. This study aimed to (a) describe cross-country tax revenue variations and (b) investigate how changes in taxation were related to changes in government tax revenue, using data from Estonia, Germany, Latvia, Lithuania and Poland.

METHODS

For the population aged 15 years or older, we calculated the annual per capita alcohol excise tax revenue, total tax revenue, gross domestic product and alcohol consumption. In addition to descriptive analyses, joinpoint regressions were performed to identify whether changes in alcohol excise taxation were linked to changes in alcohol excise revenue since 1999.

RESULTS

In 2022, the per capita alcohol excise tax revenue was lowest in Germany (€44.2) and highest in Estonia (€218.4). In all countries, the alcohol excise tax revenue was mostly determined by spirit sales (57-72% of total alcohol tax revenue). During 2010-20, inflation-adjusted per capita alcohol excise tax revenues have declined in Germany (- 22.9%), Poland (- 19.1%) and Estonia (- 4.2%) and increased in Latvia (+ 56.8%) and Lithuania (+ 49.3%). In periods of policy non-action, alcohol consumption and tax revenue showed similar trends, but tax level increases were accompanied by increased revenue and stagnant or decreased consumption.

CONCLUSIONS

Increasing alcohol taxation was not linked to decreased but increased government revenue. Policymakers can increase revenue and reduce alcohol consumption and harm by increasing alcohol taxes.

Estonian alcohol control legislation in 1990-2020: A narrative review

ISSUES

The aim of this narrative review is to provide a detailed, chronological overview on the development of Estonian alcohol control legislation during 1990-2020.

APPROACH

Qualitative document review focused on six legislative acts central to Estonian alcohol control policy. Distinguishing four policy areas (availability, advertising, taxation and drink-driving), the review identifies and describes significant changes in these legislative acts and their amendments from 1990 to 2020.

KEY FINDINGS

The review identified 51 significant changes in acts regulating either availability, advertising, taxation or drink-driving in Estonia. Majority of these changes (n = 36) relate to Alcohol Excise Duty Act and the Alcohol Act which regulate the taxation, production and sales of alcohol. Although all six key legislative acts were introduced during the 1990s, only a few significant changes to alcohol control policy were made in this decade. In contrast, the 2000s experienced an intense period of new legislation and amendments followed by 2010s when the main emphasis was on alcohol taxation and advertising.

IMPLICATIONS

During three decades, Estonian alcohol control legislation has gradually evolved to include most evidence-based measures to reduce the harmful use of alcohol, the effects of the policies on consumption and alcohol-related harms remain relatively modest.

CONCLUSION

The liberal and unregulated alcohol control measures in the 1990s have transitioned in the following two decades towards a coherent alcohol policy. While many of the World Health Organization's 'best buys' have been successfully implemented, there are still some recommendations which have not been targeted.

Impact of the WHO "best buys" for alcohol policy on consumption and health in the Baltic countries and Poland 2000-2020

Alcohol use is a major risk factor for burden of disease. This narrative review aims to document the effects of major alcohol control policies, in particular taxation increases and availability restrictions in the three Baltic countries (Estonia, Latvia, and Lithuania) between 2000 and 2020. These measures have been successful in curbing alcohol sales, in general without increasing consumption of alcoholic beverages from unrecorded sources; although for more recent changes this may have been partly due to the COVID-19 pandemic. Moreover, findings from time-series analyses suggest improved health, measured as reductions in all-cause and alcohol-attributable mortality, as well as narrowing absolute mortality inequalities between lower and higher educated groups. For most outcomes, there were sex differences observed, with alcohol control policies more strongly affecting males. In contrast to this successful path, alcohol control policies were mostly dismantled in the neighbouring country of Poland, resulting in a rising death toll due to liver cirrhosis and other alcohol-attributable deaths. The natural experiment in this region of high-income European countries with high consumption levels highlights the importance of effective alcohol control policies for improving population health.