Explained: Why is Japan asking its youth to drink more?

Spurred by falling tax revenues, the Japanese government is urging its young people to find ways to promote alcohol consumption in the country.

In a competition, “Sake Viva”, culminating in November, Japan’s National Tax Agency invited people to submit business plans to promote Japanese alcoholic beverages such as sake, shochu, awamori, beer and more.

While the initiative generated an online buzzit also raised ethical questions regarding the promotion of an unhealthy habit.

We examine the liquor industry in Japan and what has driven the need for competition.

Why does Japan feel the need to promote alcohol?

Japan’s alcohol industry is in decline. According to a report by the National Tax Agency, in fiscal year 2020, alcohol tax accounted for 1.9% of all collections. By comparison, in fiscal year 2010, the liquor tax represented 3.3% of total tax revenue, and in 2000 it represented 3.6% of total revenue. In 1994, the alcohol tax accounted for 4.1% of total tax revenue.

Data from two decades (2000-2020) shows that the amount of taxes collected on alcohol and the volume of sales (consumption) have decreased in Japan (see graph below). In 2000, the tax levied on alcohol was 1,758,800 million yen, and the volume of sales or consumption was 9,519,513 kL. In 2020, however, the government collected 1,068,100 million yen in alcohol tax, while consumption was 7,827,698 kL.

In a 2021 report, the National Tax Agency says “the taxable volume of alcohol has declined since peaking in 1999”, especially for beer, which over the years has been the alcohol product. most consumed taxable. The report notes that there has been a shift in drinking habits, with drinkers preferring low-cost alcohol, such as sparkling liquor, chuhai and beer-like products, to beer. The Covid-19 pandemic has also led to a drop in national alcohol consumption, especially in restaurants, due to the lockdown.

In Japan, the alcohol industry contributes to regional economies and the growth of small and medium-sized enterprises that dominate alcohol production in the country.

As the country’s economy returned to its pre-pandemic size earlier this week, concerns remain about its continued recovery. Private consumption has increased since the easing of lockdowns, a Reuters indicated report. However, the price hikes could deter people from spending on “recreation and restaurants”, he said.

Besides the impact of the coronavirus pandemic, “demographic changes such as a declining birth rate and an aging population” have also contributed to the shrinking of the alcoholic beverage industry in Japan, according to Sake’s website. Long live.

Indeed, the Japanese population is aging. A 2020 International Monetary Fund (IMF) report states, “With a median age of 48.4, Japan’s population is the oldest in the world.” Additionally, Japan’s current population of 127 million is also expected to decline by a quarter by 2060.

So what is the goal of ‘Sake Viva’?

According to its website, people between the ages of 20 and 39 can submit business plans to “revitalize” the liquor industry in Japan. The competition invites entries from all countries and registration is open until September 9. The selected business plans will then compete in a tournament in Tokyo on November 10.

The National Tax Agency, organizer of the competition, is looking for ways to promote a range of alcoholic beverages and “stimulate demand among young people”. He is open to ideas that respond to lifestyle changes following the Covid-19 pandemic and instill the use of artificial intelligence and the metaverse to drive sales.

The competition is part of a series of measures taken by the Japanese government to promote its alcohol industry, such as national online festivals for wine and craft beer, liquor awareness campaigns local authorities, creating an online brewery registry, promoting sake at home and abroad, and expanding exports.

Japan’s Sake Viva contest raises health concerns

The announcement of the competition raised concerns that it was promoting an unhealthy habit. According BloombergJapan’s health ministry said it “understood the spirit of the promotion to be in line with its view that people should ‘drink responsibly’.”

The National Tax Agency also said it does not encourage people to drink excessively and that the competition is only aimed at stimulating economic growth, Bloomberg reported.

In June, The Asahi Shimbuna Japanese daily, published the results of a survey conducted by Kyoto University, which showed that alcohol-related diseases and the risk of addiction associated with the consumption of alcoholic beverages at home increased during the pandemic.

“The rate of people hospitalized for alcohol-related liver disease or pancreatitis from April to June 2020 was about 1.2 times higher than before the novel coronavirus pandemic,” the survey found.

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