The government should ban selling alcohol at below the cost of duty and VAT but tougher laws are likely to be unworkable, Morrisons has claimed.

Using VAT and duty would be the easiest way to ban below-cost sales but coming to any agreement on what constituted cost would be difficult because of competition laws, it said.

"We have been talking to government and proposed it should legislate to stop retailers selling alcohol below duty and VAT," said Richard Taylor, director of corporate affairs. "It's the most straightforward way to stop below-cost sales. We think it's better to use duty and VAT rather than trying to intervene to set prices across the market."

Setting a minimum price above the cost of tax would penalise responsible drinkers and customers expected Morrisons to set its own prices, he added.

The government is considering four options for banning the sale of alcohol below cost, which it is expected to consult on this month. The first option is the one favoured by Morrisons.

The second involves attributing a cost to the beverage. The third would ban retailers from selling below the cost of invoice while the fourth would allow retailers to consult with one another to agree prices.