More than 767 Bhutanese lost their lives to alcohol liver disease (ALD) in the past six years as per data with the health ministry.
According to the latest annual health bulletin 2020, 139 people died due to ALD in 2019, which was the highest cause of mortality in the country than any other form of diseases combined.
ALD continues to be the number one killer in Bhutan. The average proportion of deaths attributed to ALD is about 30 percent in the past five years.
In the bid to address this growing concern, experts now recommend imposing 10 percent sales tax on all alcoholic beverages including an ad-valorem (according to value) excise duty, and a specific tax of Nu 500 per 1,000ml of ethanol on all types of products.
Health officials said that on comparing the existing laws in the country and the WHO’s recommendations for alcohol-prevention policy interventions, there was a need for a more effective approach to alcohol taxation in the country.
Currently, all non-beer products are subjected to no sales tax, and 30-75 percent excise duty depending on the quality. All beer products are subjected to 100 percent sales tax and no excise duty.
Changing the alcohol taxation and introducing specific tax is one of the many recommendations made in the recent review of alcohol pricing and taxation policies in Bhutan.
A group of technical experts from the World Health Organisation (WHO) South-East Asia Regional Office, International Health Policy Programme and Faculty of Economics, Chulalongkorn University, Thailand, and Khesar Gyalpo University of Medical Sciences of Bhutan conducted the review.
The increase in the price of alcohol is expected to reduce consumption according to the review report. For example, under the proposed change, when the price of K5 Whiskey is increased from Nu 800 (750ml) to Nu 1,418.90, the consumption is estimated to drop by 17.79 percent.
Similarly, one of the highest drops in consumption was observed for Zumzin peach wine. A 750ml of the wine currently costs Nu 245. With the proposed taxation, consumption would fall by about 54 percent as the new price of the wine increases to Nu 439.62.
Besides changing the alcohol taxation and introducing the specific tax, the review report also recommends phasing out the production of industrially produced lower-quality alcohol. Lower-quality alcohol according to the report was harmful to health and should not be distributed in the market.
To ensure that the proposed tax reforms were effective, control of the sales and production of homebrewed alcohol was also recommended. However, given that traditional alcohol was an integral part of the Bhutanese culture, experts said that the only practical solution to this would be through educational programmes and campaigns on the harmful effects of homebrewed alcohol.
Alcohol outlet licensing and zoning policies
Health officials said that although several alcohol prevention policies were implemented both at the national and community levels, the rate of compliance among drinkers and sellers were still low and the enforcement of the existing laws were weak.
As per WHO’s recommendations for alcohol-prevention policy interventions, Bhutan needed to control the rapidly multiplying alcohol outlets in the country.
Recommendations were made for short, medium, and long term interventions. In the short run or within a year, experts proposed that the licensing fees of bars be raised ‘drastically’ and that the licensing fees be standardised across the country.
In the medium run which is between two and three years, it was recommended that the renewal of existing licenses be linked with additional requirements. Experts said that licenses should be granted separately to on-premise alcohol outlets like bars and restaurants, where alcohol is consumed on the premises, and off-premise alcohol outlets such as alcohol shops, where alcohol is consumed off the premises.
For both types of outlets, upon applying for or renewing their licenses, owners should be required to provide detailed contingency plans, should injuries or violence or breach of peace within the community occur as a result of their alcohol sales.
It also recommended that owners should undergo a government-provided training programme. For on-premise alcohol outlets specifically, alcohol servers or bartenders should have a personal license in addition to the outlet license and undergo the same training.
In the long run, between three and five years, it was recommended that alcohol outlet density in the country be controlled by limiting the number of licenses. In particular, experts said that the number of alcohol outlet licenses should be pre-specified at the community level, taking into account the size of the population.
In the meantime, it was also recommended that all prohibited zones for alcohol outlets needed to be redefined. In the long run, it was recommended that laws on alcohol outlet zoning be enacted and instead of identifying the prohibited areas based on a fixed radius of monastic or educational institutions, which is part of the regulations now, the concept of zoning should be redefined such that it encompasses residential areas in general and highways in particular.
Along with the recommendations, it was also suggested that the country should simultaneously set up a monitoring system for the existing laws, impose fines, and revoke licenses permanently upon the third-time offence.
Health officials said that as the government pushed for a larger national policy for alcohol reduction in the country, the recommendation made would provide an insight into the existing challenges and opportunities.
Besides the adverse social and health effects of alcohol, the economic toll on the government from alcohol is also huge. The direct cost of treating one alcoholic patient is estimated at Nu 122,000, contributing to the escalation of health care costs.