(The Center Square) – The amount of money charged statewide for liquor varies widely from state to state, and federal and Iowa alcohol taxes push the price people pay per bottle to the seventh highest in the country.
That’s loud on Analysis carried out published by the tax foundation on Wednesday. Combined taxes on spirits in Iowa add an average of $ 13.03 per gallon of 40 proof or higher spirits.
Using data from the United States’ Distilled Spirits Council, the Tax Foundation calculated implicit excise tax rates in states with state monopoly sales.
Iowa has the seventh highest liquor taxes in the country and is a control state where the government operates the liquor stores, wrote Ulrik Boesen, senior policy analyst at the Tax Foundation, in an email to The Center Square. Taxes are collected by the Alcoholic Beverages Department, which increases liquor prices by up to 50%.
“Last fiscal year, Iowa raised $ 133 million from liquor sales. In general, higher taxes mean higher prices for consumers, ”said Bösen.
State taxes on liquor vary widely from state to state – from no tax in New Hampshire and Wyoming to $ 35 per gallon in Washington, Boesen said.
Higher taxes usually mean higher prices for consumers.
“The tax system is generally related to the regulatory model of a state. Some states have state liquor stores with consumption taxes and surcharges (or just surcharges), while others simply rely on consumption taxes, ”Boesen said. “Regardless of whether the government revenue is raised through surcharges or consumption taxes, the costs are usually passed on to the consumer as higher retail prices.”
The federal government also tax spirits, and most states levy general sales tax in addition to consumption taxes, Boesen said.
“Alcohol tax revenue is often used for general income,” he added. “That’s because these taxes were traditionally levied on general income – dating back to the early days of the republic. However, legislators should consider spending a larger portion of this income on offsetting the societal costs associated with alcohol consumption. “
The Washington State excise rate on distilled liquor is $ 35.31 per gallon, followed by Oregon ($ 21.95), Virginia ($ 19.89), Alabama ($ 19.11), and Utah ($ 15.92).
Distilled spirits are the least taxed in Wyoming and New Hampshire. These two control states generate income directly from the sale of alcohol through state stores and have set prices so low that they are comparable to buying spirits without taxes. Missouri taxes are the second lowest at $ 2.00 per gallon, followed by Colorado ($ 2.28), Texas ($ 2.40), and Kansas ($ 2.50).