Three Faulty Arguments for MA Question 1

Election day is here, and a trip through New Hampshire this past weekend — and, of course, an obligatory NH State Liquor Store run —  reminded me about Massachusetts Question 1. If this measure passes, the 6.25% sales tax that was imposed on alcohol in 2009 will be repealed. This morning I voted “no” on question 1.

After talking to a few friends, I seem to be in the minority (among students) on this issue. Here are three arguments they make for a “yes” vote on question 1, and my responses:

1. We already pay an excise tax on alcohol; we shouldn’t be double taxed.

Yes, we do already pay an excise tax on alcohol, but it was set in 1975 and not adjusted for inflation, so it’s incredibly low. For beer, we pay only 11 cents per gallon, according to The Tax Foundation. That’s only $1.70 for that keg of Natty Light at the frat party you don’t remember going to last weekend. In “tax-free” New Hampshire, the excise tax on beer — at 30 cents per gallon — is almost triple that of Massachusetts.

2. The price of booze at [any liquor store near campus] is already too expensive. We shouldn’t have to pay sales tax on top of that.

Repealing the sales tax on alcohol in Massachusetts would make the price of booze slightly cheaper for college students, but I think that many of my peers think that we would be paying the pre-tax sticker prices for alcohol after the sales tax is repealed. Even though we technically “pay” the sales tax in a transaction, liquor stores feel some burden of the sales tax because of a concept called price elasticity, and they charge lower prices than they would if there were no sales tax. If question 1 is passed, the pre-tax prices of all alcohol will go up. Students will still pay a premium on alcohol because of the huge demand for booze on college campuses, and because it’s inconvenient for students without cars to travel away from campus to a more affordable package store.

3. I shouldn’t have to pay extra to support alcoholics.

First, the tax doesn’t only support alcoholics. It produces over $100 million to support a wide range of behavioral health problems across the state. Second, it’s irresponsible to take away funding for drug and alcohol abuse programs while making alcohol cheaper and more accessible. As countless people have argued before me, alcohol isn’t a necessity like food or clothing — both of which receive tax exemptions — and it shouldn’t have a special exclusion.

Did you vote today? What are your thoughts on Massachusetts Question 1?