Proposed tax increase on alcohol stirs debate at Roundhouse

By Daniel J. Chacón, The Santa Fe New Mexican State Rep. Joanne Ferrary choked back tears Friday while advocating for a bill to increase New Mexico’s liquor excise tax to a flat 25 cents per serving, part of an effort to reduce consumption in a state with a serious drinking problem. “It’s important to know […]

Proposed tax increase on alcohol stirs debate at Roundhouse

By Daniel J. Chacón, The Santa Fe New Mexican

State Rep. Joanne Ferrary choked back tears Friday while advocating for a bill to increase New Mexico’s liquor excise tax to a flat 25 cents per serving, part of an effort to reduce consumption in a state with a serious drinking problem.

“It’s important to know New Mexico [is] No. 1 in the nation in alcohol-related deaths,” the Las Cruces Democrat said before taking a long pause to compose herself.

“We have to do something,” she said, her voice cracking with emotion.

“We buried my niece less than a month ago to an alcohol-related fall,” she continued. “We’ve been working on this a long time, but we keep losing people along the way.”

Ferrary’s proposal, House Bill 230, cleared its first legislative hurdle when the House Health and Human Services Committee advanced it on a vote of 6-4 after an hourlong discussion and debate.

Rep. Tara Jaramillo, D-Socorro, joined Republican Reps. Jenifer Jones of Deming, Stefani Lord of Sandia Park and Harlan Vincent of Ruidoso in voting against the measure. Jaramillo didn’t explain her vote.

In addition to raising the alcohol tax for the first time in 30 years, HB 230 would distribute about 86% of the revenue from the tax to a new Alcohol Harms Alleviation Fund, dubbed the AHA Fund.

“The fund … would allow our state agencies to really deeply address the harms associated with alcohol … in terms of prevention, treatment, recovery supports and the social determinants of health that lay at the root causes,” Shelley Mann-Lev, director of the Santa Fe Prevention Alliance, told the committee.

Supporters of the bill included Mothers Against Drunk Driving and the DWI Resource Center.

Dr. Jennie Wei, an addiction medicine physician who has worked in Gallup since 2012, said there is no way to exaggerate the extent of alcohol-related harms in the state.

“We’re facing a public health emergency, and I’m not talking about COVID, but one we’ve been facing for decades now and only getting worse,” she said.

Like Ferrary, Wei spoke about the real-life impacts of alcohol abuse.

“I never get used to seeing a 28-year-old mother of three in fulminant liver failure, yellow from head to toe, because she can’t clear her toxins, bleeding from every orifice of her body because she can’t make the proteins needed to clot blood,” Wei said. “I never get used to telling her children and her mother that she has died from a preventable illness. Yes, a preventable illness, but only if sound, evidence-based public health practices are enacted like HB 230.”

The bill drew stiff opposition from the powerful alcohol industry.

Brent Moore, a registered lobbyist for Anheuser-Busch, said the Missouri-based brewing company supports responsible consumption.

“There is no doubt that New Mexico needs to support those efforts,” he said.

But he decried what a fiscal impact report identified as “substantial” liquor excise tax increases on liquor, beer and other alcohol.

Sen. Bill Tallman, D-Albuquerque, a co-sponsor of the bill, said it’s “unconscionable” the state hasn’t increased the alcohol tax in three decades.

“It’s unfortunate when I hear legislators say, ‘Well, it’s so difficult to raise taxes,’ ” he said. “Well, we’ve raised the tobacco tax several times in the last 30 years but not alcohol. I ask people, ‘Why is that?’ They say it’s because the alcohol lobby is stronger and more forceful than the tobacco industry. What a sad commentary.”

Representatives for the New Mexico brewer and distiller guilds, the New Mexico Restaurant Association and the Greater Albuquerque Chamber of Commerce also testified against the bill.

“We don’t dispute that our state has a drinking problem,” said Sara Fitzgerald, the Albuquerque chamber’s senior vice president of policy research and strategic communications. “But simply ratcheting up a tax isn’t the answer to combating alcohol abuse. It needlessly punishes very responsible adults, and it would hurt local economies.”

Fitzgerald argued attempts to make alcohol “a cost prohibitive luxury” wouldn’t deter anyone from drinking.

“The truly determined will cross borders to build their own personal stores,” she said.

Dr. David Jernigan, a professor at Boston University School of Public Health who is considered an expert on alcohol policy, told legislators the bill would reduce alcohol consumption in New Mexico by roughly 7%.

He said the “single most effective thing” that can be done to reduce alcohol problems is to raise the price of alcohol.

“We have literally hundreds of studies that have quantified just how much less people will drink and how much alcohol problems will decline in response to tax increases,” he said. “The bottom line here: Alcohol taxes save lives. They also have the greatest impact on exactly the group causing the problems, which is the excessive drinkers.”

Using a tool developed for the Centers for Disease Control and Prevention, Jernigan estimated 75% of any increase in New Mexico’s tax on alcohol would be paid by the 19% of the state’s population of excessive drinkers.

Jernigan noted New Mexicans who don’t drink alcohol, which he said represents about half the population, won’t have to pay anything.

A fiscal impact report on the bill states the proposed rate increases would be passed on to consumers, “which may drive some of the purchasing of products to neighboring states with lower tax rates or to online retail purchasing.”

Follow Daniel J. Chacón on Twitter @danieljchacon.

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