Drinkers Should Pay More for Alcohol's Havoc:
Action Guide Offers Map for State Alcohol-Tax Hikes

Citizen-advocates now have a how-to manual on raising state taxes on beer, wine, and liquor to combat the havoc that alcoholic beverages wreak on American society.

According to State Alcohol Taxes & Health: A Citizen's Action Guide, published by the nonprofit Center for Science in the Public Interest (CSPI), low tax rates "perpetuate high levels of alcohol...problems and deny state governments a valuable source of additional revenue."

Alcohol accounts for 100,000 deaths a year. It is a major cause of premature death and a major contributor to lost productivity, health care spending, traffic collisions, violence, crime, spousal and child abuse, falls, fires, drownings, and suicides. The total costs to society each year are about $100 billion.

"In the face of these enormous social and economic costs," said George Hacker, director of CSPI's Alcohol Policies Project and a co-author of the Action Guide, "our federal, state, and local governments collect only $17 billion a year in alcohol taxes. Higher tax rates could both reduce drinking problems and finance education and regulatory programs."

The Action Guide identifies three ways in which increasing alcohol taxes would counter the tragic social and economic losses associated with drinking:

  • It would generate substantial revenue for substance-abuse treatment and prevention programs, as well as other social, police, judicial, and prison systems whose resources are drained in responding to alcohol-related problems.
  • It would raise additional funds for revenue-starved state and local governments.
  • It would cut alcohol consumption -- and problems -- by driving up the cost of beverages. Economists estimate that a 10 percent price increase would lower consumption by 3.5 percent. Young drinkers in particular would drink less, studies have shown.

Tax rates vary widely from state to state. On average, state and local taxes now amount to 4 cents a shot for liquor, 3 cents a glass for table wine, and 2 cents per 12-ounce beer. Federal excise taxes add about 12 cents per shot of liquor, 4 cents per glass of wine, and just over 5 cents per 12-ounce beer.

The 60-page Action Guide urges seeking not only one-time increases, but indexing the taxes so that they keep pace with inflation. It includes detailed instructions on researching local or state problems related to alcohol consumption, building coalitions, and mounting education campaigns. It also explains how to estimate the effect alcohol tax increases will have on prices, consumption, revenues, and alcohol problems.

The guide contains data on state alcohol tax rates, a catalog of the public health costs related to alcohol, and an extensive list of government and nonprofit resources. It identifies likely sources of opposition and the arguments against higher taxes on alcohol, and offers factual responses to those arguments.

"The alcohol industry has a huge propaganda machine that cranks out an endless stream of images and messages about the fun and social status of drinking," says CSPI's Hacker. "Legislators, journalists and the public hear little about the extensive costs of alcohol. The Action Guide is a key tool that citizens can use to help reduce alcohol problems."

Preparation of the Action Guide was assisted by grants from The Robert Wood Johnson Foundation of Princeton, New Jersey, and the S.H. Cowell Foundation of San Francisco. CSPI is providing the guide to hundreds of organizations concerned about alcohol problems. Individual copies are available from CSPI for $10.

CSPI is a nonprofit health-advocacy organization that focuses on alcoholic-beverage problems, nutrition, and food safety. It is based in Washington, D.C., and is supported largely by more than one million subscribers to its Nutrition Action Healthletter and foundation grants. It does not accept industry or government funding. CSPI led efforts to win passage of the law requiring warning labels on alcoholic beverages and has publicized the nutritional content of many popular restaurant foods.

To read excerpts from State Alcohol Taxes and Health, click here.

Send your publication order to:

Alcohol Policies Project
Center for Science in the Public Interest
1220 L St., NW  Suite 300
Washington, DC  20005
Phone: 202-332-9110, x385
Fax: 202-265-4954

May 31, 1996