Asia’s non-alcohol woes: India tightens regulations for alcohol-free beers as Thailand mulls tax raises
The Food Safety and Standards Authority of India (FSSAI) has issued a new directive for alcohol-free beer in the country under the paragraph for Beer in the Food Safety and Standards (Alcoholic Beverages) Regulations.
“A new clause shall be inserted in Part 4, Regulation 4.1 [of the Alcoholic Beverages Regulations] related to ‘Beer’, namely that Alcohol-free beer shall carry alcohol-by-volume (ABV) level of 0.0,” said FSSAI Advisor for Standards N. Bhaskar in the new directive.
“New draft regulations [for Alcoholic Beverages] are in the process of being notified, and the finalisation of these regulations are likely to take some time.”
Under the same regulation, beers with 0.5% to 5.0% ABV are considered Regular or Mild, whereas those with over 5.0% ABV are considered Strong (up till 8.0% when it will be not be considered under Beer regulations).
The status of beers with above 0.0% ABV but below 0.5% ABV has not been finalised in this directive, and final instructions are not expected until the finalised regulations are released.
However, the currently-valid Alcoholic Beverage regulations still state that ‘Alcoholic beverages containing not more than 8.0% ABV may be called as ‘low-alcoholic beverages’’ – meaning that for now, all such beers can be considered ‘low-alcoholic’ but not ‘alcohol-free’.
Most of such beers in the Indian market today claim to be non-alcoholic (and this is often used interchangeably with zero-alcohol and alcohol-free), such as Budweiser 0.0, Hoegaarden 0.0 and Heineken 0.0 – but due to the process of brewing these where alcohol is usually removed post-brewing, there would usually still some miniscule remnants of alcohol.
According to Heineken themselves, there is an ‘extremely small amount of alcohol’ in Heineken 0.0, although this is so small it is considered negligible.
“Heineken 0.0 contains an extremely small amount of alcohol, maximum 0.03% ABV. This is comparable or less than found in other food products such as bread, bakery products and juices due to the natural fermentation of the ingredients,” the firm told us previously.
“Heineken 0.0’s label and ingredient declaration is in line with local food laws and regulations.”
Although this 0.03% ABV is likely low enough to be omitted in terms of scientific and health implications, the wording of FSSAI’s new regulations now leaves the term ‘alcohol-free’ open to interpretation, at least until the new, full Alcoholic Beverages regulations are announced.
Taxing low-alcohol beers in Thailand
Over in Thailand, the local Finance Ministry, Health Ministry and Excise Department are considering raising the tax rates applied to low-alcoholic beers to reflect its status ‘between’ non-alcoholic beverages and alcoholic ones.
At present, low-alcoholic beers are subject to similar tax rates as carbonated drinks at 14%, whereas alcoholic beverages are taxed 28%.
According to Excise Department Director-General Patchara Anuntasilpa, things are now in the hands of the Thai Public Health Ministry to determine whether levies should be raised for low-alcoholic beers.
“[These beers] are one of the options following the government's policy to reduce alcohol consumption, [but] need to be regulated similarly to alcohol such as banning the sales of these near schools,” he told Bangkok Post.
“The Public Health Ministry is analysing this, but their current top priority is containing the COVID-19 outbreak, so they will come back to this after the situation improves.”
According to Nation Thailand, HS Code and tax rate analysis has already been completed by the ministry to land between that of carbonated drinks and alcoholic drinks, but increased rates are not expected to affect retail prices.
Even last year, Thailand had already been mulling tighter regulatory control for low-to-no-alcoholic drinks, with concerns floating around regarding the advertising and labelling of these.
“If it’s advertised as an alcohol-free malt beverage, there’s no problem, but if it’s advertised as an alcohol-free beer, we have to examine the intention and whether the advertising is breaking any law,” said Dr Nipon Chinanowet, Director of the Office of Alcohol Control Committee under the Thailand Public Health Ministry Department of Disease Control.
“[Beer companies could have] one non-alcohol product advertised legally at the same time as [an alcoholic product, creating] a link in the audience’s mind to [the] products which are restricted from advertising.”
In Malaysia, Heineken’s launch of Heineken 0.0 last year also met with a controversial start less than a month in, when a local minister said that its advertising was ‘confusing’ for Muslim consumers.
“Using an alcohol brand name without the alcohol is very confusing because the process of manufacturing the beverage, including distillation, falls under the system of producing alcoholic products,” said then-Minister in the Prime Minister's Department Datuk Dr Mujahid Yusof.
“We know that [these drinks] are made by alcohol companies, so even if it is said to not contain alcohol, this can cause confusion and make Muslims think that they can consume it.”
Heineken was not mentioned by name, but Heineken 0.0 was the latest non-alcoholic beer launched in the country at the time.
The firm also issued a statement clarifying that its marketing excludes Muslims as a target demographic.
The low-to-no alcohol beverage category has enjoyed rapid growth, which has also attracted big mainstream beer brewery names such as Kirin and Asahi to launch their own low-to-no-alcoholic versions of beer.