Vice Squad
Monday, May 16, 2005
Economists For Higher Alcohol Taxes

Nearly 60 US economists are in such sufficient agreement that they signed a petition to Congress calling for higher alcohol taxes. (The petition, a 3-page pdf file, is available here.) Besides supporting higher alcohol taxes in general, they also think that beer should not receive favorable tax treatment relative to wine or spirits, on a per-ounce of alcohol basis. The signatories include four Nobel Prize winners, and several leading vice policy researchers.

I support higher federal excise taxes on alcohol in the US; but I am less certain that spirits shouldn't be taxed more highly than wine or beer. Naturally fermented alcoholic beverages have been around since time immemorial, but distilled alcohol is a relatively recent phenomenon. I think that it is more dangerous than fermented products, and that stricter controls, possibly including higher taxes, are appropriate for the more-potent products. The fact that beer is the beverage of choice for youthful drinkers is in part a response to the lower taxes and less-strict controls, yes, but I am not sure that we want to implicitly encourage a substitution to hard liquor via a policy that treats beer, wine, and spirits identically.

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