AMA survey shows Americans happy to increase state alcohol taxes

May 4 2004

A new national survey on alcohol taxes released today by the American Medical Association Office of Alcohol and Other Drug Abuse reveals that 90 percent of Americans are concerned about teenage and underage drinking and that voters, by a margin of two to one, favor a tax increase on alcohol in their states to help fund prevention programs.

"Alcohol abuse costs Americans more than $148 billion each year in health care and social costs. Among the most vulnerable of these drinkers are teens. Research shows that alcohol use has a devastating effect on teens' developing bodies and brains. Alcohol consumption by teens may cause permanent learning and memory loss, AMA President-Elect John C. Nelson, MD, MPH, said. "Therefore, it is no wonder that parents agree with the AMA that it is reasonable to tax the product itself to fund health care, education and other programs."

Conducted by the Mellman Group and QEV Analytics with 800 registered voters, the survey showed strong support among Democrats, Independents and Republicans for increases in so-called "sin taxes" such as tobacco and alcohol, to reduce state budget deficits. Respondents supported using revenue from alcohol tax increases to fund education, health care and law enforcement related to drinking.

The poll also demonstrated that most Americans do not know the alcohol tax rate in their state. Once given that information, a majority of voters supported an increase and one-third of those believed alcohol taxes should be raised "a lot."

"As with smoking, the price of alcohol matters, especially with teenagers," said Dr. Richard A. Yoast, Director of the American Medical Association's Office of Alcohol and Other Drug Abuse. "Just as price increases for tobacco reduce consumption and disease, higher alcohol prices are proven to reduce everything from violent crimes to rape. The difference is taxes on cigarettes have been increased frequently and significantly over the years while alcohol taxes have remained astoundingly behind the times.

One example of stagnant taxes on alcohol can be found in Connecticut. Tobacco taxes have been raised twice in the past two years for a total tax of $1.01 per pack in Connecticut while beer taxes have not been raised in Connecticut since 1989. The tax is only 11.25 cents per six-pack of beer in that state.

The poll showed that respondents were more likely to favor raising alcohol and tobacco taxes than several other potential remedies for dealing with state budget deficits. While 65 percent supported alcohol tax increases, voters "opposed" other solutions, such as increasing state sales tax (75 percent opposed), increasing state income tax (76 percent opposed), reducing social services (77 percent opposed), reducing Medicaid (86 percent opposed) and reducing funding for education (91 percent opposed).

The methodology used in the survey was as follows: telephone interviewing was conducted with 800 registered voters April 15-18, 2004. Respondents were selected using random digit dialing to ensure an unbiased sample. The margin of error for this sample is plus or minus 3.5 percentage points at the 95% level of confidence.

The AMA notes that several organizations working to reduce underage drinking are also working to promote alcohol tax increases in their states, including:

• Connecticut’s governor introduces a 10 percent increase in the state's alcohol taxes in his annual budget plan. The Connecticut Coalition to Stop Underage Drinking has provided additional information to key legislators and state agency officials on the positive impact of such a tax;
• The Georgia Alcohol Policy Partnership Coalition to Reduce Underage Drinking supported Georgia Governor Sonny Perdue’s recent proposed alcohol excise tax increases;
• The Indiana Coalition to Reduce Underage Drinking has been working with legislators from both parties to get a bill on alcohol taxes introduced as a top priority for the 2005 session;
• The Missouri Youth/Adult Alliance Against Underage Drinking mobilized statewide support for a recent committee hearing on increasing taxes on all alcoholic beverages;
• The Minnesota Join Together group is working on several bills that include alcohol excise and alcohol sales tax increases. A bill to extend the sales tax on alcohol and send 50 percent of the money to counties to fund alcohol related costs is also currently under consideration by the state legislature;
• The Partners to Reduce Underage Drinking in North Carolina is developing a campaign to push for a beer excise tax and educate legislators on the ramifications of signing a blanket "no new tax pledge"; and
• Members of Texans Standing Tall are promoting an alcohol excise tax increase to address the state's school finance crisis.

Through its Office of Alcohol and Other Drug Abuse, the AMA has taken a leadership role to reduce the harm caused by alcohol and other drug abuse, particularly underage drinking. The AMA Office of Alcohol and Other Drug Abuse directs two national programs, supported by the Robert Wood Johnson Foundation: "Reducing Underage Drinking Through Coalitions" and "A Matter of Degree: The National Effort to Reduce High-Risk Drinking Among College Students."

More information on these programs is available at: www.alcoholpolicysolutions.net.