Marin Institute: Beer Tax Increases Long Overdue in 12 States

Budget deficits bedevil nearly every state, yet six states have not raised their beer taxes in 50 years or more, according to a new interactive map published by Marin Institute called the Neglected & Outdated Beer Taxes Map. Wyoming, in fact, hasn’t raised its beer tax since 1935, when Franklin D. Roosevelt was serving his first term as president.

The six states that have not changed their beer taxes in at least 50 years are Kentucky, Louisiana, Mississippi, Pennsylvania, West Virginia, and Wyoming. Marin Institute also compared actual tax rates and the amount of real value lost to inflation, and found six more states with extremely low and out-of-date beer taxes — Georgia, Idaho, Michigan, Missouri, North Dakota, and Wisconsin — to create a list of the bottom 12 states in the nation.

“Just point your cursor at a state and you can see [your state’s] current beer tax rate, the year of your last tax increase, and the loss of revenue from inflation,” said Bruce Lee Livingston, CEO of the Marin Institute. “We show the twelve states that have hit the bottom of the barrel in beer tax revenues and are the most overdue for an increase.”

The problem, according to Marin Institute, isn’t just low tax rates, it’s also inflation. In 47 states, the revenue from beer taxes lost to inflation ranged from 25 percent to over 75 percent.

For example, the real value of Wyoming’s beer tax — 2 cents a gallon — has eroded by a whopping 94 percent since it was created. According to Marin, an increase of a nickel a drink in Wyoming would yield nearly $8 million in annual revenue, easily exceeding the $5 million budget shortfall projected for the state by 2013.

The solution? Marin Institute recommended that states looking for revenue consider raising their beer taxes — and indexing the new rates to inflation.

Is your state at the bottom of the “beer tax barrel”? 

More information

• Neglected & Outdated Beer Taxes Map (Marin Institute)
• State Legislative Activity: Alcohol Taxes (Marin Institute)
• Action alert for residents of the bottom 12 states (Marin Institute)