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

CHAPTER 4

INTRODUCTION

With the right information about tax rates and revenues in your state and a modest amount of mathematical acumen, you should be able to predict the fiscal and other consequences of various tax increase proposals. In order to assist you in this effort, we have developed a straightforward mathematical model that incorporates reasonable assumptions about the price elasticity of alcoholic beverages and the likely mark-up on products that carry higher taxes. In the previous chapter, we reviewed a simple method of equalizing the tax rates on alcohol in beer, wine, and distilled spirits and provided estimates of the approximate alcohol content of different beverage types. In this section, we'll show you how to calculate average prices for alcoholic beverages and where to find the volumes of beverages sold in your state. You'll need that information to estimate the effects o higher taxes on prices and consumption. If you get stuck, don't hesitate to call CSPI's Alcohol Policies Project for assistance.

CSPI 1996

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