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Taxes Can Reduce Binge Drinking

Taxes Can Reduce Binge Drinking

New research discovers that higher alcohol taxes are an effective method to protect against binge drinking. A decline in episodes of binge drinking is linked to less alcohol-related deaths as well as a significant economic gain.

Boston University School of Public Health (BUSPH) researchers, found that a one-percent increase in alcohol beverage prices from taxes was associated with a 1.4 percent decrease in the proportion of adults who binge drink.

The research study has been published in the journal Addiction.

Although prior studies have examined the effect of taxes on average consumption, the value conveyed by taxes to reduce high-level drinking has been controversial.

“This is really significant for public health,” said lead author Ziming Xuan, Ph.D., assistant professor of community health sciences at BUSPH.

The public health value comes from a reduction in mortality and economic losses.

Xuan explains that binge drinking causes more than 45,000 alcohol-attributable deaths in the U.S. each year, and accounts for three-quarters of the $224 billion in annual economic costs.

The study shows that as combined alcohol taxes rise, binge drinking rates fall. Taxes accounted for approximately 20 percent of the difference in binge drinking prevalence rates across U.S. states.

The state with the highest beer combined taxes — Tennessee — had the lowest binge drinking rate (6.6 percent) in 2010, while states with low alcohol taxes, such as Montana, Wisconsin, and Delaware, had relatively high binge drinking rates.

Binge drinking was defined as consuming five or more drinks for men, or four or more drinks for women, per occasion.

The percentage of adults who reported binge drinking in U.S. states was based on data from the Behavioral Risk Factor Surveillance System surveys from 2000-2010.

Researchers discovered a new measure that combines the value of both volume-based and value-based taxes on alcohol does a better job on showing the benefit of preventive measures to limit binge drinking.

The new metric improved the precision of statistical results, compared to the conventional use of only volume-based excise taxes.

Using the comprehensive measure, taxes had about twice the impact on binge drinking, compared to using only excise taxes.

Xuan and co-author Dr. Timothy Naimi, associate professor of the Boston University Schools of Medicine and Public Health and senior author of the study, said many previous U.S. studies might be underestimating the effect of higher taxes on reducing alcohol consumption.

They said their study demonstrates a key vulnerability of volume-based taxes: their erosion over time due to inflation. Such taxes are levied as a fixed dollar amount per unit volume, rather than as a percentage of price.

“This study emphasizes the importance of assessing multiple co-existing tax types — and possibly tax structure — for characterizing the relationship between tax and related outcomes, evaluating the effects of tax policy interventions, and for planning tax policy interventions,” the researchers said.

Source: Boston University School of Public Health

Money and alcohol photo by shutterstock.

Taxes Can Reduce Binge Drinking

Rick Nauert PhD

Rick Nauert, PhDDr. Rick Nauert has over 25 years experience in clinical, administrative and academic healthcare. He is currently an associate professor for Rocky Mountain University of Health Professionals doctoral program in health promotion and wellness. Dr. Nauert began his career as a clinical physical therapist and served as a regional manager for a publicly traded multidisciplinary rehabilitation agency for 12 years. He has masters degrees in health-fitness management and healthcare administration and a doctoral degree from The University of Texas at Austin focused on health care informatics, health administration, health education and health policy. His research efforts included the area of telehealth with a specialty in disease management.

APA Reference
Nauert PhD, R. (2018). Taxes Can Reduce Binge Drinking. Psych Central. Retrieved on December 3, 2020, from
Scientifically Reviewed
Last updated: 8 Aug 2018 (Originally: 6 Jan 2015)
Last reviewed: By a member of our scientific advisory board on 8 Aug 2018
Published on Psych All rights reserved.