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Why Raise Alcohol Taxes?


In the past 55 years, the federal excise tax on beer has been raised just once, in 1991, under the Revenue Reconciliation Act of 1990.  In the past 20 years, 31 states have not raised their beer taxes.  Failure to adjust those tax rates for inflation has caused a dramatic decline in their value and resulted in a loss of billions of dollars in potential revenues that could have helped fund essential health and human needs programs or reduce the deficit.  A 2008 report of the Congressional Budget Office estimated that modestly increasing and reforming federal alcohol taxes could generate more than $28 billion in new revenue over five years.  Resulting reductions in problem drinking would produce further significant savings in health care expenditures (for both the drinker and affected family members), and decreased law enforcement and other alcohol-related costs.


Dormant tax rates have also contributed to a gradual and substantial decline in the price of alcoholic beverages.  According to the National Institute on Alcohol Abuse and Alcoholism (NIAAA), lower prices on alcohol are associated with increased levels and frequency of drinking, particularly among underage persons.  Aside from providing a source of new revenue, increasing taxes on alcohol will deter underage use, reduce traffic-crash fatalities and certain crimes, and decrease alcohol-related health problems such as cirrhosis.  Alcohol use is the 3rd leading cause of early mortality in the U.S. and, like, tobacco, imposes enormous economic costs on society—some $185 billion per year according to the latest government estimates.  Even small increases in taxes—pennies per drink—would translate into significant new revenues.  Alcohol taxes do not disproportionately target low-income people—who already drink at lower rates than those with higher incomes—and will be of little, if any, burden on the vast majority of consumers. Revenues from alcohol continue to be of more importance these days, as our nation and at least 41 states struggle to overcome budget deficits.


The Federal Front


Fact Sheets



Letter to Congress Urging an Alcohol Tax Increase


Sample House Ways and Means Committee Letter Opposing Beer Tax Rollback  


The State Scene

Fact Sheets  


Excise Tax Rates by State


Tax Rankings by State


Price Elasticities


Control States and License States



Advocacy Action Guides


State Alcohol Taxes and Health: A Citizen's Action Guide


Increasing Alcohol Taxes to Fund Programs to Prevent and Treat Youth-Related Alcohol Programs



Beer Taxes


Factbook on State Beer Taxes


Beer Tax Rankings: See Where YOUR State Ranks!



State Alcohol Tax History, 2002-2005


Increases and Proposals



Alcohol Tax Calculator: Project the Effects of Varying Increases in Alcohol Tax Rates on Revenues, Consumption and Product Prices







Sample Presentation Materials


Slideshow on State Alcohol Issues



Sample State Reports


2004 Reports

Alabama, March 2004

Connecticut, March 2004

Maryland, March 2004


2003 Reports

California, March 2003

New Mexico, October 2003


2002 Reports

Maryland, November 2002

Texas (from Texans Standing Tall), January 2002



General Tax Information



Why Raise Alcohol Taxes to Protect Underage Youth? Evidence Supporting NAS Report Recommendations


Responses to Industry Mythology


Addressing Regressivity: Do Higher Alcohol Taxes Really Hurt Lower Income People?


Beer Industry Jobs


Responses to Industry Propaganda





Press Releases


Noted Economists Support Higher Taxes on Alcoholic Beverages (2005)


Alcohol Tax Hikes Prove Popular in New Poll (2005)

More Information


Research on Alcohol Excise Taxes and Public Health and Safety Policy


Additional Resources



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