Preventing Excessive Alcohol Use: Increasing Alcohol Taxes
Alcohol excise taxes affect the price of alcohol, and are intended to reduce alcohol-related harms, raise revenue, or both. Alcohol taxes are implemented at the state and federal level, and are beverage-specific (i.e., they differ for beer, wine and spirits). These taxes are usually based on the amount of beverage purchased (not on the sales price), so their effects can erode over time due to inflation if they are not adjusted regularly.
Task Force Recommendations & Findings
The Task Force on Community Preventive Services recommends increasing the unit price of alcohol by raising taxes based on strong evidence of effectiveness for reducing excessive alcohol consumption and related harms. Public health effects are expected to be proportional to the size of the tax increase.
Results from the Systematic Reviews
Seventy-three studies qualified for the review.
- The studies looked at the relationship between either tax rates or total price on measures related to excessive alcohol consumption or its related harms.
- The effects of prices on consumption or other outcomes are often expressed as “elasticities,” that are defined as the expected percentage change in the outcome when the price increases by 1%. For example, an alcohol price elasticity of -0.50 would mean that the outcome of interest (e.g., alcohol consumption) would be expected to decrease by 5% for every 10% increase in price.
Alcohol price and per capita consumption
- Price elasticity of alcohol consumption (i.e., the expected percentage change in alcohol consumption when the price increases by 1%)
- Beer consumption: -0.50 (interquartile interval: -0.91 to -0.36; 18 studies)
- Wine consumption: -0.64 (interquartile interval: -1.03 to -0.38; 22 studies)
- Spirits consumption: -0.79 (interquartile interval: -0.90 to -0.24; 21 studies)
- Total alcohol (ethanol) consumption: -0.77 (interquartile interval: -2.00 to -0.50; 11 studies)
- Price and consumption by high school or college age youth
- Six studies found consistent evidence that higher alcohol prices were associated with less youth drinking; 3 studies found mixed results (9 studies).
Alcohol price and alcohol-related harms
- Higher alcohol prices or taxes were consistently related to:
- Fewer motor vehicle crashes and fatalities (10 of 11 studies)
- Less alcohol-impaired driving (3 of 3 studies)
- Less mortality from liver cirrhosis (5 of 5 studies)
- Less all-cause mortality (1 study)
- Effects also were demonstrated for measures of violence (3 studies), sexually transmitted diseases (1 study), and alcohol dependence (1 study).
Supporting Materials
- Analytic frameworks
- Economic efficiency
- Research gaps
- Summary evidence table
- Search strategy
Publications
Elder RW, Lawrence B, Ferguson A, Naimi TS, Brewer RD, Chattopadhyay SK, Toomey TL, Fielding JE, Task Force on Community Preventive Services. The effectiveness of tax policy interventions for reducing excessive alcohol consumption and related harms. Am J Prev Med 2010;38(2):217-29.
Task Force on Community Preventive Services. Increasing alcohol beverage taxes is recommended to reduce excessive alcohol consumption and related harms. Am J Prev Med 2010;38(2):230-2.
More Community Guide publications about Preventing Excessive Alcohol Use
Disclaimer
The findings and conclusions in this page are those of the authors and the Task Force on Community Preventive Services and do not necessarily represent the official position of CDC.
Sample Citation
The content of publications of the Guide to Community Preventive Services is in the public domain. Citation as to source, however, is appreciated. Sample citation: Guide to Community Preventive Services. Preventing excessive alcohol use: increasing alcohol taxes. www.thecommunityguide.org/alcohol/increasingtaxes.html. Last updated: MM/DD/YYYY.
Review completed: June 2007
- Page last reviewed: January 15, 2010
- Page last updated: January 15, 2010
- Content source: The Guide to Community Preventive Services
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