A 9p/unit tax would ensure that alcohol duty is a tax on alcohol, not an arbitrary tax on fluids. EU regulation currently prohibits this system of alcohol taxation. Outside of the EU, Britain will no longer be constrained—Institute of Economic Affairs
Source: iea.org.uk/publications/a-rational-approach-to-alcohol-taxation/
Note: The simplicity of the system is attractive, as is the idea of taxing the potentially harmful element of alcoholic drinks alone. It is interesting, however, to imagine how it might look in the real world. Strong white cider, widely condemned for fueling abuse because it is so cheap, is curently taxed at 7.3p a unit. So increasing the tax to 9p a unit might be expected to raise its price by 1.7p for each unit. This would mean a 3 litre bottle of 7.5% cider, which contains 22.5 units, might go up from £3.99 to £4.37. Would this be enough to deter cash-strapped drinkers? It seems unlikely. An admirably fair and rational tax may be ineffective in curbing inherently irrational patterns of consumption. ■