Raising Alcohol Taxes

I just read on BBC that they want to increase taxes on alcohol. This always sounds like a good idea at first, but when analyzed, turns out to be highly misguided. At first, you think "sure, why not increase taxes to make more money on alcohol. Then they might not raise my income or property taxes." I just want to highlight a few of the flaws that I see in a strategy like this.

First, the government is out one side of their mouths saying "alcohol is bad, don't do it" but then at the same time they have a stake in alcohol sales, since they get tax money from it. We have the same question here in the US about gambling, smoking, and other legal vices. To me it undermines the credibility of the anyone that says something is bad and then profits from it.

Second, it is based on a false notion. I highly disagree that the low cost of some alcohols are what lead to drinking and in turn alcohol-related deaths. The BBC article says, "The Alliance says increasing the price of alcohol by 10% could cut all alcohol-related deaths by between 10% and 30%." But without any evidence sited that I noticed. Probably because it is a statement of opinion. The BBC article also frames this as a child-related issue, which is really just a way for the story to evoke more of a response from the neo-prohibitionists. So I'll rebut with my own opinion: "Kids drink to get drunk, and because they believe it will make them cool. Even adults have the same motivations to a certain extent. Price is one factor, but an increase of ten percent is not going to change anything, except maybe the people will have less money to spend on other things."

Now it is hard to argue against the problems that come from excessive drinking, but increasing the government's rake off the sales of booze doesn't even really indirectly address the problem. I'll broadly suggest the same things that countless of other anti-neo-prohibitionists have said: let's try setting good examples for our children at home, modeling appropriate appreciation and enjoyment of alcohol, and responsible behavior around alcohol.

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