ABSTRACT
The US federal excise taxes on alcoholic beverages have not been raised since 1951. Between 1960 and 1980, the real price of liquor declined 48 percent, of beer 27 percent, and of wine 20 percent. Indeed, alcohol taxation is increasingly being touted as an effective public health measure. Taxation and other control policies are criticised as overly blunt instruments, reducing the enjoyment of the many for the sake of curtailing the alcohol-related problems suffered by the relatively few. An increase in taxes on liquor or beer results in an increase in the average prices of these commodities and a reduction in alcohol consumption from these sources. Statistics on the prevalence of chronic heavy drinking are not routinely available. The enormous decline in the real value of the US federal excise taxes on alcoholic beverages has benefited heavy drinkers in financial terms, but has had the effect of increasing the prevalence of alcoholism and its attendant costs.
