SDG 3: Good Health and Well-being | SDG 17: Partnerships for the Goals
Ministry of Health and Family Welfare | Ministry of Finance
The World Health Organization (WHO) has released its 2025 global assessment, revealing that alcohol excise taxes remain a significantly underutilized tool for public health. Despite alcohol being a leading risk factor for 2.6 million annual deaths and numerous noncommunicable diseases (NCDs), median global excise tax shares remain low at 14% for beer and 22.5% for spirits. As of July 2024, while 167 countries apply national-level excise taxes, at least 25 countries—primarily in Europe—continue to exempt wine, a practice that contradicts WHO recommendations for comprehensive taxation.
Policy Design and Implementation Gaps
Standardized Structures: Volume-based specific excise represents the most-used system for beer and wine, while alcohol-content-based specific taxes are most prevalent for spirits.
Inflation Vulnerability: Fewer than one in four countries (23%) mandate automatic regular adjustments for specific tax rates. Without indexation, these taxes lose real value as they are eroded by inflation, making alcohol more affordable over time.
Low Protection for the Vulnerable: Only a small fraction of countries (4-8%) implement a minimum specific excise tax, which is a powerful tool to raise the price of the cheapest, most harmful products consumed by heavy drinkers.
Revenue Earmarking: Currently, 28 countries earmark excise revenue for health programs, such as NCD prevention, alcohol control, and universal health coverage.
Strategic Global Initiatives
The “3 by 35” Initiative: Launched in July 2025, this global effort aims to increase the real prices of tobacco, alcohol, and sugary drinks by at least 50% by 2035 through systematic tax increases.
Economic Win-Win: Taxation is recognized as a “win-win-win” strategy that reduces healthcare costs, generates government revenue, and improves health equity by reducing consumption more significantly in lower-income households.
Policy Relevance
Effective alcohol taxation is critical for curbing the health, social, and economic burdens of consumption while funding essential public health infrastructure.
Strategic Impact for India:
Combating NCD Prevalence: Strengthening excise structures directly supports India’s National Programme for Prevention and Control of NCDs, targeting a major risk factor for cardiovascular diseases and cancer.
Adopting Content-Based Taxation: Transitioning to alcohol-content-based specific taxes would allow India to incentivize the production and consumption of lower-alcohol alternatives, reducing overall ethanol intake.
Inflation-Proofing Revenue: Implementing automatic indexation to inflation would prevent the erosion of tax value, ensuring that alcohol does not become more affordable as disposable incomes rise.
Health System Financing: By earmarking a portion of alcohol revenue for health programs, India could accelerate progress toward Universal Health Coverage and bolster the Fit India Movement.
Global Leadership in DPI: Standardizing alcohol tax data would enable India to benchmark its state-level policies against global best practices and the WHO’s “3 by 35” targets.
Follow the full report here: Global report on the use of alcohol taxes 2025