Vice Squad
Monday, May 02, 2005
The Alcohol Laffer Curve?

Louisiana's tax rate on wine is lower than that of any other state, and it has a pretty low tax rate on spirits, too. Nevertheless, "the Louisiana state government collected more taxes per resident on those products than 21 other states, according to a U.S. Census report recently released." Maybe those higher rates in other states entice folks to a bit more smuggling and moonshining, or, perhaps, folks in Louisiana make up for their low rates in volume. At any rate (!), the Louisiana state legislature is thinking about raising alcohol and tobacco taxes.

A drunk became known as a "wino" because tax rates on wine have traditionally been lower than on other forms of alcohol in the US. So the cheapest way to get drunk has often been to drink fortified wine.

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