Study: Higher alcohol taxes reduce fatal crashes

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Photo: © Europen Parliament/P.Naj-Oleari pietro.naj-oleari@europarl.europa.eu

Channel 4 recently reported on a study recently issued by University of Florida Health.  According  to the study, increasing state alcohol taxes could prevent thousands of deaths a year from car crashes.   How did they come to this conclusion?  They looked to Illinois who increased taxes on beer, wine and spirits.  After the increase in taxes in 200, Illinois saw fatal alcohol-related car crashes declined 26 percent.. The decrease was even more marked for young people, at 37 percent.  The reduction was similar for crashes involving alcohol-impaired drivers and extremely drunken drivers, at 22 and 25 percent, respectively. 

The tax wasn’t a drastic increase in prices for an alcoholic drink.  The law had the tax on beer to go up by 4.6 cents per gallon, on wine by 66 cents per gallon and on distilled spirits by $4.05 per gallon. How would this cost be passed to the consumer, assuming the entirety of the taxation cost was passed to them? It would result in a .4 cent increase per glass of beer, a .5 cent increase per glass of wine and a 4.8 cent increase per single serving of spirits. The research team used  records of fatal crashes from the National Highway Traffic Safety Administration from January 2001 to December 2011. They looked at the 104 months before the tax was enacted and the 28 months after it was enacted to see whether the effects of the tax change differed according to a driver’s age, gender, race and blood alcohol concentration at the time of a fatal motor vehicle crash.  The research team defined an impaired driver as having a blood alcohol level of less than .15 percent and an extremely drunk driver as having a blood alcohol level of more than .15 percent, which translates to roughly six drinks within an hour for an average adult.  To control for several other factors that can affect motor vehicle crash rates, the researchers compared the number of alcohol-related fatal crashes in Illinois with those unrelated to alcohol during the same time period as well as alcohol-related fatal crashes in Wisconsin, which did not change its alcohol taxes. Results confirmed that the decrease in crashes was due to the tax change, not other factors.  The larger-than-expected size of the effects of this modest tax increase may be because the tax change occurred at the same time as the Great Recession — a time when unemployment was high and personal incomes lower, according to the study. 

Alcohol-related motor vehicle crashes account for almost 10,000 deaths and half a million injuries every year in the United States. Alcohol is more affordable than ever, a factor researchers say has contributed to Americans’ widespread drinking and driving.  Drinking more than 10 drinks per day would have cost the average person about half of his or her disposable income in 1950 compared with only 3 percent in 2011. Alcoholic beverages have become so inexpensive because alcohol tax rates have declined substantially, after taking inflation into account. 

What does this study bring out that is unique? As told to US News World and Report by one of the researchers, “We identified that alcohol taxes do in fact impact the whole range of drinking drivers, including extremely drunk drivers.”

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