In this article, we are going to discuss the 20 countries with the highest beer taxes in the world. You can skip our detailed analysis of the global beer market, the largest beer producer in the world, the effect of taxes on alcohol abuse, the country with the lowest beer tax in the world, and the rising prices of beer, and go directly to the 5 Countries with Highest Beer Taxes in the World.
There is a substantial amount of evidence that suggests that any alcohol consumption, however moderate, can have negative health consequences. Even low levels of drinking can increase the risk of heart disease, high blood pressure, and even certain types of cancer. Understanding that there is no such thing as risk-free drinking, the World Health Organization has called on the international community to increase taxes on alcoholic beverages to discourage consumption. According to the organization, at least 148 countries around the world have applied excise taxes to alcoholic beverages at the national level.
Global Beer Market:
If your idea of relaxing at the end of the day involves cracking open a cold one, you’re not alone. Beer is the Most Consumed Alcohol in the World. As we mentioned in our article – Top 25 Beer Producing Countries in the World – the global beer market was valued at $793.74 billion in 2022, and is projected to grow from $821.39 billion in 2023 to $1.07 trillion by 2030, with a CAGR of 3.88% during the forecast period. The overall demand for premium and low-calorie beers, the rising popularity of craft beer, and the expansion of distribution networks in emerging markets are expected to continue driving growth in the global beer market over the next few years.
The Effect of Taxes on Alcohol Abuse:
The booze industry argues that alcohol excise taxes do not reduce heavy drinking because of substitutions to lower-cost products and that these taxes disproportionately burden low-income drinkers. Alternatively, over the last two decades, a growing number of economists have examined the impact of alcohol beverage taxes and prices on alcohol consumption and heavy drinking. Several of these studies have focused on high-risk populations, such as youth and young adults, including college students.
This research, using a variety of different data and empirical approaches, has generally found that an increase in the prices of alcoholic beverages led to reductions in drinking, heavy drinking, and the consequences of alcohol use and abuse. These findings indicate that a rise in alcoholic-beverage taxes could be a highly effective option for reducing alcohol abuse and its consequences.
Increasing alcohol taxes could not only improve public health, but also reduce the disparity between alcohol-related costs and total alcohol taxes in states. It could help prevent the reallocation of the societal cost of drinking from those who drink excessively to the general public. Conversely, if specific excise taxes are not increased, these are likely to further erode over time because of inflation, which could result in an even greater disparity between alcohol taxes and alcohol-attributable costs.
According to a study conducted by the NCD Advisory Council’s signature initiative working group, if countries of the WHO European Region were to introduce a minimum level of 15% tax on the retail price per unit of alcohol, regardless of the type of alcoholic beverage, it would save 133,000 lives each year.
Country with the Lowest Beer Tax in the World:
According to data from the WHO, Nauru is the Country with Lowest VAT and GST Rates on Alcohol, with both of them amounting to zero in 2022. Excessive alcohol consumption, together with high tobacco use, place a heavy burden on the tiny island country, in terms of rising health care costs, lost productivity, and early death from noncommunicable diseases resulting from unhealthy lifestyle choices.
Largest Beer Producer in the World:
The brewing behemoth Anheuser-Busch InBev SA/NV (NYSE:BUD) is the Largest Beer Company in the World, with 518 million hectolitres of volume produced in 2022. Formed by the $52 billion acquisition of Anheuser-Busch by InBev in 2008, the company boasts over 630 beer brands in 150 countries worldwide. Anheuser-Busch InBev SA/NV (NYSE:BUD) reported a revenue of $59.38 billion in 2023, with a net income of almost $5.34 billion.
Anheuser-Busch InBev SA/NV (NYSE:BUD) is included among the Best Brewery and Distillery Stocks to Buy Now.
The Rising Prices of Beer:
Beer isn’t as much of a bargain as it used to be and beer prices worldwide have witnessed a sharp spike over the last two decades. Americans especially are drinking fewer brews and the sector is steadily losing market share to spirits. Beer companies, faced with rising operating costs in areas like packaging and transportation, have raised prices and seen bigger profits, with consumers footing the bill.
The price of beer bought at retail locations, such as grocery stores, rose 5.9% for the 12 months through April 2023 compared with the prior year, according to data from the Bureau of Labor Statistics. The rate topped the overall 4.9% inflation for the same period. Since 2000, the price of retail beer consumed at home has increased more than 72%, while it has climbed even more for people drinking outside the home, jumping 102% during that time.
With that said, here are the Countries with the Highest Beer Tax Rates in the World.
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Methodology:
To collect data for this article, we have referred to the Global Health Observatory of the WHO, looking for the Countries with the Highest Beer Tax. The following countries have been ranked by their total percentages of tax (including excise tax, VAT, and sales tax) on beer in 2022.
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20. South Africa
Percentage of Tax on Beer in 2022: 40.63%
With a total beer production of 33.75 million hectoliters in 2022, South Africa is placed among the Top Beer Producing Countries in the World. It was announced in February that the South African government would raise the sin taxes on alcohol by between 6.7% and 7.2% over the next year to help raise additional revenue for closing its massive deficit.
19. Philippines
Percentage of Tax on Beer in 2022: 40.64%
The Philippines uses health taxes – excise taxes imposed on health-damaging products like alcohol, tobacco etc. – to help fund its universal health coverage program. The country’s government raises around $500 million annually from alcohol levies.
18. Iceland
Percentage of Tax on Beer in 2022: 40.82%
Iceland has a bit of a reputation for expensive alcohol. The country raised its alcohol tariff by 7.7% in 2023 to help raise an additional $11.7 million for the treasury, with total income from alcohol taxes for 2023 estimated at around $175 million.
17. Latvia
Percentage of Tax on Beer in 2022: 40.88%
Despite the high taxes, beer is by far the most popular alcoholic beverage in Latvia, and the locals’ love of the good stuff means they create some exceptional varieties too. With an annual per capita beer consumption of 80.2 liters, Latvia is included among the Countries with the Most Beer Consumption in 2024.
16. Japan
Percentage of Tax on Beer in 2022: 41.05%
A bottle of beer in a Tokyo bar or restaurant can be ridiculously priced, sometimes costing up to $8. To counteract the country’s largest liquor tax revenue decrease in 31 years, the Japanese National Tax Agency (NTA) launched a contest last year, asking people between the ages of 20 and 39 to develop business plans to increase alcohol demand among young people.
15. Mauritius
Percentage of Tax on Beer in 2022: 41.84%
The Mauritius government raised the excise duty for alcohol and tobacco products by 10% last year, putting it among the Countries with the Highest Beer Tax in 2024. Launched in 1963, Phoenix Beer is the most popular brew in Mauritius.
14. Sri Lanka
Percentage of Tax on Beer in 2022: 42.51%
Alcohol consumption among Sri Lankans, as well as the alcohol-related health and social issues, have been steadily increasing since 2009, when the 26-year armed conflict between the country’s military forces and Liberation Tigers of Tamil Eelam (LTTE) finally came to an end.
Several policies have been implemented in Sri Lanka to decrease alcohol consumption, including a ban on advertisement and sports sponsorship for alcohol, a minimum age of 21 for sales of alcohol, restriction of sales on specific religious holidays, increases in prices and taxes, and popularization of lower-strength products assuming they would substitute stronger ones.
13. Rwanda
Percentage of Tax on Beer in 2022: 43.5%
In 2019, the Rwandan government introduced tax breaks for alcohol brewed from locally sourced raw material to promote domestic investment and reduce imports. As part of the policy, the excise duty for beers and wines with a high local raw material content was halved to 30%.
12. United Kingdom
Percentage of Tax on Beer in 2022: 44.12%
Despite the high taxes, alcohol has become much more affordable in real terms in the UK over the past few decades. According to a report by the NHS, alcohol was 72% more affordable in 2020 than it was in 1987.
The UK sits among the Countries with the Highest Alcohol Tax in the World, with the country’s Office for Budget Responsibility estimating that alcohol duties will raise $15.77 billion in 2023/24, rising to $20.15 billion in 2028-29.
11. Ireland
Percentage of Tax on Beer in 2022: 44.3%
Ireland is the country with the second-highest excise duty in the EU, at 55 cents for a pint of lager, compared to just 5 cents for the same beverage in Romania or Spain. Excise tax receipts for alcohol were the highest for beer in Ireland in 2022, totaling around $419 million.
According to recent statistics, the number of breweries in Ireland has more than quadrupled in the last decade, surpassing the 100 mark and still counting, turning the Emerald Isle into one of the Best Beer Countries in 2024.
10. Tunisia
Percentage of Tax on Beer in 2022: 44.77%
Alcohol is not only legal in the Muslim-majority country of Tunisia, but it is a thriving industry, thanks in part to the growing number of tourists there. Tunisia’s largest beer producer, La Société de fabrication des boissons de Tunisie (SFBT), reported a revenue of approximately $263.4 million last year.
9. Eritrea
Percentage of Tax on Beer in 2022: 45.45%
Beer is by far the most popular tipple in Eritrea, with the state-owned Asmara beer dominating the local market. Meanwhile, Heineken – one of the Most Exported Beer Brands in the World – is the most popular import beer in the East African country.
Eritrea is placed among the Top 10 Countries with the Highest Beer Tax.
8. Samoa
Percentage of Tax on Beer in 2022: 47%
In 2018, Samoa raised the excise tax on beer from 5% to 8% to meet the growing costs of providing critical government services, including medical, public safety, and others. Valima, brewed by Samoa Breweries, is among the most popular beers in the Beautiful Island Country.
7. Finland
Percentage of Tax on Beer in 2022: 48.17%
In 2007, alcohol consumption in Finland reached an all-time high of 12.7 liters per capita, partly due to alcohol taxes being decreased by 44% in 2004. However, the situation had changed drastically by 2022, when the per capita consumption of pure alcohol came down to 7.6 liters, mainly due to a series of tax hikes over the last decade.
6. Gambia
Percentage of Tax on Beer in 2022: 50.17%
The Gambian government decided to increase the tax on wine and beer by a whopping 75% in 2019, but the decision was later reversed after heavy lobbying from Big Alcohol, and the tax rates were instead reduced. The Castel Group-owned Banjul Breweries, the sole beer maker in Gambia, threatened to quit operations in the country if the tax rates weren’t decreased, thus putting pressure on the Finance Ministry.
Gambia ranks 6th in our list of Countries with the Highest Tax Rates on Beer.
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Disclosure: None. 20 Countries with Highest Beer Taxes in the World is originally published on Insider Monkey.