Fewer fatal car crashes when alcohol taxes go up

"If policymakers are looking to address dangerous drivers on our roads and reduce the number of fatalities, they should reverse the trend of allowing inflation to erode alcohol taxes," says Alexander C. Wagenaar. (Credit: Thomas Hawk/Flickr)

Increasing state alcohol taxes could prevent thousands of deaths a year from car accidents, say researchers.

A new study shows that after taxes on beer, wine, and spirits went up in Illinois in 2009, fatal alcohol-related motor vehicle crashes declined 26 percent. The decrease was even more marked for young people, at 37 percent. Crashes involving alcohol-impaired drivers and extremely drunken drivers had similar declines at 22 and 25 percent, respectively.

“Similar alcohol tax increases implemented across the country could prevent thousands of deaths from car crashes each year,” says Alexander C. Wagenaar, professor of health outcomes and policy at University of Florida College of Medicine.

Affordable alcohol

“If policymakers are looking to address dangerous drivers on our roads and reduce the number of fatalities, they should reverse the trend of allowing inflation to erode alcohol taxes.”

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, which has contributed to Americans’ widespread drinking and driving, researchers say.

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.

Beer, wine, and spirits

In August 2009, the state of Illinois raised its excise tax on beer by 4.6 cents per gallon, on wine by 66 cents per gallon, and on distilled spirits by $4.05 per gallon. Assuming the entirety of the taxation cost is passed on to the consumer, that 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 study, published online in the American Journal of Public Health, used detailed records of fatal crashes from the National Highway Traffic Safety Administration from January 2001 to December 2011.

Researchers 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 drunken 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.

Great Recession

To control for multiple other factors that can affect motor vehicle crash rates, such as traffic safety programs, weather, and economic conditions, 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 confirm 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, researchers say.

“While our study confirms what dozens of earlier studies have found—that an increase in alcohol taxes reduces drinking and reduces alcohol-related health problems, what is unique is that we identified that alcohol taxes do in fact impact the whole range of drinking drivers, including extremely drunk drivers,” Wagenaar says.

“This goes against the conventional wisdom of many economists, who assert that heavy drinkers are less responsive to tax changes, and has powerful implications for how we can keep our communities safer.”

Source: University of Florida