Yes, New Mexico! It’s Time to Raise Your Alcohol Tax and Charge for Harm

New Mexico Tax REAL

August 18, 2016

On Tuesday, August 23, New Mexico's state legislature will consider raising the state tax on alcohol to 25 cents. If you thought a quarter was small change, you'd be amazed at the positive impact the increase will have on the health and well-being of New Mexico's residents, not to mention cities, counties, hospitals, public health officials, and government coffers.

Currently, New Mexico holds first place in a dismal race--it leads the U.S. in the number of annual deaths per capita attributed to alcohol. As Dr. Holly Mata reports in the Almogordo Daily News, 1 in 6 deaths in New Mexico among people aged 20 to - 64 is caused by excessive drinking. That's 1,139 individuals whose deaths from alcohol-related causes (including traffic crashes, violence, cancer, liver failure, falls, injuries, and other illnesses) could have been prevented.

Daunting figures.

An yet, studies show that an additional 25 cents excise tax is a strong enough disincentive to prevent 12,375 people from suffering alcohol dependence or absue in any given year. Even more telling, this small bump in price is enough to reduce New Mexico's underage drinkers by 13%. That's 7,150 kids who will have some powerful help in resisting temptation.

Paying for Harm

The revenue from alcohol-related excise taxes offer wide-ranging social benefits.

When researchers at the University of New Mexico added up these hidden costs, they found every New Mexican resident is spending more than $400 a year in taxes for public services by city and county police, ambulance and emergency medical care providers, plus administrative court and detention cases.

Public health experts estimate the economic cost of excessive drinking for New Mexico approaches $2 billion a year.

An alcohol excise tax turns these numbers upside down. A 25 cents-per-drink tax raises $154 million in New Mexico's state revenue that will be spent on law enforcement, education, and rehab programs focusing on underage drinking, drinking and driving, and alcohol dependence.

The tax is not regressive. First, the state has not increased its excise tax since 1993. And, while it does hit the excessive drinker the hardest, nearly 49% of New Mexico's residents don't drink. They won't pay a cent!

Every resident will see direct benefits to public health. Part of the revenue is earmarked for 2017's Medicaid Expansion Match. The federal program, part of the Affordable Care Act, is expressly for low-income and disabled residents. In New Mexico, the program will provide health insurance coverage to more than 200,000 people.

So, go ahead: pick heads or tails. No matter how you toss the coin, it makes great sense to increase New Mexico's alcohol tax.

  • Learn more about Alcohol Justice's Charge for Harm campaign.
  • Curious to learn how a similar excise tax would impact your state's revenue? Use our Tax Calculator and find out.