A Refresher Course on New Mexico’s Booze Taxes

“Taxes haven’t gone up since 1993. That’s the last time we’ve raised alcohol taxes.”

Get used to hearing that argument. A lot.

“Alcohol Taxes Save Lives & Money” is lobbying to raise New Mexico’s taxes on alcohol by 25¢ a drink. The organization claims that “given our budget deficit, it makes sense to require the drinkers causing [alcoholism] problems to pay for a portion of them, rather than cutting the jobs and services provided to all New Mexicans.”

Regardless of when alcohol taxes were last hiked — is there ever a good time to implement a bad idea? — the more interesting question is how New Mexico compares to its neighbors. And a quick look at the Tax Foundation’s invaluable maps on alcohol taxes reveals that the Land of Enchantment is already overtaxing adult beverages.

New Mexico is tied with Utah for the highest beer tax in the region:

beer

New Mexico has the highest wine tax (Utah does not levy a tax, since it controls wine sales within its borders):

wine

New Mexico ranks second to Utah’s almost comically high tax on distilled spirits:

spirits

No one disputes the state’s depressing alcohol-abuse statistics. But as the Franklin Center for Government and Public Integrity’s Jason Stverak noted: “Research by the National Institute on Alcohol Abuse and Alcoholism has found that hardcore alcohol abusers are affected little by increases in price, which have a greater effect on light and moderate drinkers.”

So don’t buy the spin that a higher per-drink tax is a low-impact way to close budget deficits and combat alcoholism. It’s just another way for the state’s political establishment to avoid the serious work of right-sizing New Mexico’s bloated budget.

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