Economists to Congress: Don't Cut Liquor Taxes!

Some of America's most distinguished economists today called for what they say are long-overdue increases in federal excise taxes on alcoholic beverages to help offset the massive economic and social costs of alcohol. In a declaration to Congress organized by the Coalition for the Prevention of Alcohol Problems (CPAP, photo), the economists, who include four Nobel laureates, say legislation promoted by the alcohol industry to reduce such taxes would damage public health, increase budget deficits, and threaten the safety of Americans, especially young people.

"Through neglect, Congress has allowed effective rates of tax on a substance that does more harm than any illegal drug to fall dramatically, even as the federal budget has sunk far into the red," said Henry Aaron, senior fellow in economic studies at the Brookings Institution.

"Tens of millions of dollars a year already are spent marketing alcoholic beverages to underage consumers," said George A. Hacker, director of the Alcohol Policies Project at the nonprofit Center for Science in the Public Interest and a CPAP convener. "Lower taxes and lower prices will only further entice young people to drink. Calls for an alcohol tax reduction clearly are designed to line the pockets of the alcohol industry, without regard to the consequences."