.svg)
.svg)
Like most states across the country, Louisiana’s budget is stretched to the limit with no or low funds allocated to essential resources. For this reason, the Louisiana House recently decided to increase the taxes on alcohol. Though raising taxes will not stop the cutbacks planned for health services and public colleges, it was determined to be a positive move toward addressing the budget shortfall.
Initially, the number of votes necessary to raise alcohol taxes was not there, but two days of negotiations resulted in a change of heart for a number of lawmakers, and the bill ultimately advanced to the Louisiana Senate.
Though some say that the alcohol tax hike would increase the cost of a can of by beer by less than a penny, it is believed that the bill will result in an added $19 million in the state budget each year.
Though there is an ongoing debate about whether or not to raise sales tax in general, there seemed to be far less fuss about raising alcohol taxes.
What do you think? Is it fair to tax alcohol in order to find the money to pay for healthcare services and higher education?
The Theory Behind Alcohol Taxes
The theory behind alcohol taxes is straightforward. By increasing the price of alcohol, policymakers hope to reduce demand for it. This could lead to a reduction in alcohol-related problems, including alcohol use disorder.
In addition, higher taxes can provide revenue for the state. This revenue can be used to fund programs that address alcohol-related problems, such as prevention and treatment programs.
The Potential Benefits of Raising Alcohol Taxes in Louisiana
Raising alcohol taxes in Louisiana has the potential to bring about several benefits. First, it could lead to a decrease in alcohol consumption, which would result in fewer cases of alcohol-related problems such as liver disease, drunk driving accidents, and domestic violence.
Secondly, higher taxes on alcohol could generate significant revenue for the state. This additional revenue could be used to fund programs that address alcohol-related issues, including prevention and treatment programs. These programs could help reduce the social and economic costs associated with excessive drinking.
Furthermore, research has shown that increasing taxes on alcoholic beverages can have a positive impact on public health. For example, a study conducted by researchers at the University of Florida found that raising taxes on beer reduced the likelihood of heavy drinking among young adults.
Finally, increasing alcohol taxes may also encourage individuals to switch to less harmful alcoholic beverages or non-alcoholic alternatives. This shift in behavior could lead to improved health outcomes for Louisianans who struggle with alcohol use disorder.
Overall, while raising taxes on alcohol may not be a silver bullet solution to reducing rates of alcohol use disorder in Louisiana, it is clear that there are many potential benefits worth considering.
Evidence from Other States
Several states have implemented higher alcohol taxes to reduce alcohol consumption and related problems. For example, in 2018, Maryland increased taxes on beer, wine, and spirits. The tax increase was estimated to generate $88 million in revenue, which would be used to fund education and health programs.
A study published in the Journal of Studies on Alcohol and Drugs found that Maryland's tax increase led to a decline in alcohol consumption. The study also found that the tax increase was associated with a decrease in alcohol-related problems, including drunk driving fatalities.
Similar results have been seen in other states. For example, a study published in the American Journal of Public Health found that a 10% increase in alcohol taxes in Illinois led to a 6.5% reduction in alcohol-related deaths.
Allocation of Taxes
Ultimately, the funds raised by alcohol taxes are not funneled directly to a certain cause. That is, the budget is not designed in such a way that alcohol taxes are calculated and then expenses in a certain category are determined in order not to exceed that amount. Though it might be more efficient to, for example, take the funds spent on a certain area of the budget directly related to alcohol use and abuse directly from alcohol taxes and raise taxes to ensure that those costs are covered by the people who are buying alcohol, that is not how it works. Rather, alcohol taxes are simply added to the coffers and allocated as needed – to education, healthcare, roads, law enforcement, etc.
Economics of Alcohol
It is not insignificant to note that the costs that a community incurs due to the use of alcohol by its people is no small amount, and that it is not often that the taxes on alcohol cover those costs. For example, when people abuse alcohol, the bills start adding up. Costs include:
- Healthcare and medical costs for alcohol-related medical emergencies, including car accidents
- Law enforcement costs for officers to patrol for potential drivers who are under the influence
- Legal costs for prosecuting and monitoring those who drive under the influence
- Repair costs for damage done to property by people under the influence
Additionally, there is the added cost of lost income taxes and sales tax due to a loss of productivity and the loss of employment among those who struggle with heavy drinking. Though raising taxes may in part serve to cover these costs, the Centers for Disease Control and Prevention (CDC) reports that excessive drinking cost the US about $223.5 billion in 2006, or about $1.90 per drink sold – taxes will need to raise far more than less than a penny per can of beer to cover that bill.
The Role of Prevention Programs in Reducing Rates of Alcohol Use Disorder
While raising alcohol taxes has the potential to reduce rates of alcohol use disorder, prevention programs are also a crucial part of the solution. These programs aim to prevent individuals from developing alcohol use disorders in the first place.
Prevention programs can take many forms, including education campaigns, community outreach initiatives, and targeted interventions for at-risk populations. For example, schools can implement alcohol education programs that teach students about the risks associated with excessive drinking. Community organizations can hold events that promote healthy lifestyles and discourage alcohol use.
Research has shown that prevention programs can be effective in reducing rates of alcohol use disorder. A study published in the Journal of Substance Abuse Treatment found that an intervention program aimed at reducing underage drinking was successful in decreasing rates of binge drinking among high school students.
Furthermore, prevention programs can be cost-effective. According to a report by the Centers for Disease Control and Prevention, every dollar spent on evidence-based prevention programs can save up to $64 in costs related to substance abuse treatment and other related expenses.
In Louisiana, there are several prevention programs aimed at reducing rates of alcohol use disorder. For example, the Louisiana Campaign for Tobacco-Free Living offers resources and support for individuals looking to quit smoking or using tobacco products, which are often used alongside alcohol. Additionally, local organizations such as the New Orleans Health Department offer educational campaigns on responsible drinking habits.
Overall, while raising taxes on alcohol may have its benefits, it is clear that a comprehensive approach that includes prevention programs is necessary to effectively reduce rates of alcohol use disorder in Louisiana.
The Effectiveness of Treatment Programs for Individuals with Alcohol Use Disorder
While prevention programs are crucial in reducing rates of alcohol use disorder, treatment programs are equally important for individuals who are struggling with the condition. These programs aim to help individuals overcome their dependence on alcohol and achieve long-term recovery.
There are several types of treatment programs available for individuals with alcohol use disorder. One common type is known as inpatient treatment, which involves staying at a facility where individuals can receive 24-hour medical care and support. Inpatient treatment typically lasts between 30 and 90 days and may include individual counseling, group therapy sessions, and medication-assisted treatment.
Another type of treatment program is outpatient treatment, which allows individuals to receive care while living at home. Outpatient programs may involve individual or group therapy sessions, medication-assisted treatment, or a combination of these approaches.
Research has shown that both inpatient and outpatient treatment programs can be effective in helping individuals recover from alcohol use disorder. For example, a study published in the Journal of Substance Abuse Treatment found that both inpatient and outpatient treatments were associated with significant reductions in alcohol consumption and improvements in overall health outcomes.
However, it's important to note that not all treatment programs work for everyone. The effectiveness of a particular program depends on several factors, including the severity of an individual's addiction, their personal preferences, and their willingness to participate fully in the program.
Overall, while raising taxes on alcohol and implementing prevention programs can help reduce rates of alcohol use disorder in Louisiana, it's essential to also invest in effective treatment programs to help those who are already struggling with addiction achieve lasting recovery.
The Potential Drawbacks of Raising Alcohol Taxes
While raising alcohol taxes in Louisiana may have its benefits, there are also potential drawbacks that policymakers must consider.
One potential unintended consequence is that higher prices could lead to an increase in illicit alcohol sales. If the cost of purchasing alcohol legally becomes too high, some individuals may turn to purchasing bootlegged or counterfeit products instead. These products can be dangerous and may contain harmful substances such as methanol, which can cause blindness or even death.
Furthermore, increasing taxes on alcohol could disproportionately affect low-income individuals. Research has shown that individuals with lower incomes are more likely to suffer from alcohol use disorder than those with higher incomes. Therefore, a tax increase could make it more difficult for these individuals to afford necessary treatment and support.
Finally, there is concern that raising alcohol taxes could hurt local businesses such as bars and restaurants. Higher prices for alcoholic beverages could lead to a decrease in sales, which would negatively impact these establishments and their employees.
It's important for policymakers to carefully consider these potential drawbacks before implementing any tax increases on alcoholic beverages in Louisiana. While the benefits of reducing rates of alcohol use disorder are clear, it's essential to ensure that any policies put into place do not inadvertently harm vulnerable populations or local businesses.
Addiction Treatment
The cost of court-mandated treatment and state and federally funded treatment is yet another cost associated with alcohol use – but alcohol addiction is only one of many types of addiction disorders. Those who are living with an addiction disorder may have a hard time managing a number of different behaviors. From drinking to drug use to gambling and more, engagement in compulsive behavior despite negative consequences is the defining characteristic. Treatment can help someone to learn how to manage these symptoms as long as it is comprehensive in nature and recognizes that addiction is more than substance use, gambling, or any one behavior.
For many, higher alcohol taxes are the last straw, one of many reasons to stop drinking and engaging in all addiction behaviors. For some families, the financial hardship caused by excessive drinking, gambling, shopping, and/or drug use is one of the many indications that there is a serious problem that requires change.
Will the increased alcohol taxes cause you to rethink your drinking this year? What will you do if you find that you are unable to stop drinking or cut back?
Conclusion
There is evidence to suggest that higher alcohol taxes can reduce alcohol consumption and related problems. States like Maryland and Illinois have successfully implemented higher alcohol taxes, which have led to reductions in alcohol-related problems.
Louisiana's low alcohol taxes may contribute to the state's high rates of alcohol use disorder and binge drinking. Raising taxes on alcohol could help address these problems while also generating revenue for the state.
