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NM: Drinking on the cheap — and paying a big bill

NM: Drinking on the cheap — and paying a big bill

Santa Fe New Mexican
By Ted Alcorn New Mexico In Depth
August 11, 2022

Alcohol costs New Mexico dearly. It killed 1,878 residents in 2020, three times the nation’s rate.

But getting hammered here is cheap.

At the Shop-N-Save on Gallup’s west side, a 30-pack of Natural Ice beer sells for $24.95 after tax, a little over two hours’ earnings at minimum wage. Total Wine in Santa Fe offers a five-liter box of Franzia Crisp White wine for $15.15, or 45 cents per drink. And you can’t do better than Wal-Mart in Rio Rancho, where a 1.75-liter handle of Aristocrat vodka sells for $11.84, just 30 cents a drink.

Rock-bottom prices, experts say, are at the heart of the state’s drinking problem.

Other factors contribute to New Mexico’s high rate of alcohol-related deaths: cycles of violence and trauma that perpetuate alcohol dependence, opiates and methamphetamines that make for a toxic mix with drink, and the unequal treatment of Native communities that produces yawning disparities. But the easy availability of cheap alcohol makes all this worse.

And over the last 50 years, the price of alcohol has declined dramatically compared to the average person’s income. According to one study, in order to drink heavily of even the cheapest liquor in 1970, a person would have to spend 22 percent of average after-tax income. By 2010, doing so required just 3 percent.

To reverse the state’s ballooning rate of alcohol-related deaths, experts say New Mexico has to make drinking more expensive. That can be done by taxing it at a higher rate — but the politics of doing so are difficult.

The most recent push to increase alcohol taxes, in 2017, demonstrates the feeble advocacy for change, the robust opposition to it and the powerful inertia of the status quo.

Basic economics and public health

Alcohol taxes have been around since the birth of the country — the first Congress placed a tax on imported alcoholic drinks on July 4, 1789. New Mexico’s Liquor Excise Tax Act, drafted shortly after the repeal of Prohibition, reflects its age in arcane terminology like “spirituous liquors.” The statute sets rates by the liter or gallon but converted to ‘standard drinks,’ the state taxes beer at four cents per 12-ounce can, wine at seven cents per 150-milliliter glass and liquor at seven cents per 1.5-ounce shot.