Singapore is an expensive city to live in. It is an even more expensive city to drink in.
According to the GoEuro’s latest Beer Price Index, which compares statistics gathered from 75 major cities worldwide, Singapore is ranked 70th when it comes to buying a beer, making her one of the most expensive cities to grab a cold one.
Based on the table above, the average price of beer in our city is similar to that of Miami. It also shows that Singapore is the second most expensive city in Asia to drink in, after Hong Kong. Regional cities around us such as Bangkok and Ho Chi Minh are ranked among the top ten cheapest, giving us even more reasons to embark on short trips to these nearby destinations.
In this article, we would like to share some reasons on why drinking in Singapore is so expensive.
” Undesirable good for the economy”
Quoting Export.gov, a US government website aimed at helping US companies with its overseas export, Singapore has high excise taxes on alcohol due to social and/or environmental reasons. This indicates that all alcohol imports to Singapore are taxed heavily.
To add on to drinkers’ woes, every purchase of alcoholic beverage will also be subjected to Goods and Services Tax (GST), similar to all other goods and services consumed in the country.
Since alcohol consumption isn’t exactly a major health problem in Singapore from a statistical point of view, such ” sin tax” could be deemed unnecessary for Singapore. In our opinion, a better reason to explain the high tax on alcohol would be linked to the additional revenue it brings in to help raise government’s revenue.
Monopolised alcohol industry
According to the not very welcomed Liquor Control (Supply and Consumption) Act which was introduced earlier this year, it is a crime in Singapore to be caught drinking in public places after 10.30pm. This ban also applies to selling takeaways at retail shops, with any hope of purchasing a can of beer to be enjoyed at the comfort of your home also dashed once it is10.30pm.
What this means is that after 10.30pm, the alcohol industry is ” monopolised” by licensed premises, such as bars, clubs and restaurants. Drinkers are ” rounded up” and made to drink at such licensed premises after that timing, thus increasing the market share of alcohol sales to these licensed premises.
The cost to obtain these licenses do not come cheap. With the Liquor Control (Supply and Consumption) Act, bars and clubs indirectly benefit because people can no longer buy cheaper drinks elsewhere.
It goes without saying that clubs and bars, particularly those in central locations such as Clark Quay, pay a high premium for the rental of their premises. This adds to the high cost of producing and selling beer, which would ultimately be passed down to consumers.
Remember the times when you scanned down the drinks menu , bypassing our home brewed brands such as Tiger Beer and going instead for a pint of beer that is produced overseas? Despite having our own local brewery, we dare say a lot of Singaporeans would prefer overseas beers instead of the ones produced locally.
Overseas produced beer incurs more transport, storage, and distribution costs. These lead to the imported beers costing more, and hence, a higher price tag for these products even if the taste isn’t really better.
What are some other reasons you can think of for the high prices of beers in Singapore? Share your thoughts with us on Facebook.
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