By RICHARD SKOLNIK
White Rock
The House Taxation and Revenue Committee will decide in the next few days between two bills that address alcohol. One is evidence-based and takes account of best practice and would likely be very helpful in reducing alcohol consumption and raising additional revenues to address the harms of alcohol. The other bill is not based on best practice and would either lower the costs of alcohol for some groups, leading to an increase in consumption, or provide the alcohol industry with a $50 million windfall. I have just sent the letter below to the Committee. It takes account of the very good work on this critical matter by the Alcohol Harms Alleviation Coalition of New Mexico, of which I am honored to be a part.
Dear Chair and Members of the House Taxation and Revenue Committee:
Re: HB 179 and HB 213
Thank you for the important attention you are taking to addressing alcohol-related harms in New Mexico.
Such harms are the worst in the US and the state for decades has failed to address them effectively or efficiently. Given the gravity of the situation, the fact that you are nearing your final deliberations on this matter, and the fact that you will be held accountable for the approach that emerges, I offer below, in my personal capacity, a few candid comments for your consideration.
I am a resident of White Rock, who has lived in New Mexico for 7 years. I am the former Director for Health for South Asia at the World Bank, a former Lecturer in Global Health at the George Washington University and Yale, at which I still hold an appointment, and the author of the most widely used textbook on global health. I have worked on and written on the financing of health services and on alcohol and tobacco policy, among other things, for almost 40 years.
The HB 213 Approach Would Lead to the Worst Possible Outcomes
HB213 would lower taxes on certain beverages. Depending on the actions of retailers, this would lead either to an increase in consumption or a windfall for the alcohol industry.
In the first scenario, if volume-based taxes were removed and prices decreased, only to be replaced by lower sales taxes, this would increase excessive alcohol consumption and associated harms, such as death, injury, violence, and chronic diseases.
In the second scenario, if volume-based taxes were removed and prices stayed the same, the existing revenue of $50 million would go directly into the pockets of the alcohol industry, as a handout.
Both are the antithesis of desired outcomes from policies to deal with the harms of alcohol.
One Oregon state legislator, who is himself a Native American, said that policies like this, that immiserate his people while enriching the alcohol industry, “sustain and promote systemic racism.”
HB 213 Would be Unfair and Harmful, in the Name of “Equity”
Health economists and ethicists consider taxes to be fair, as you know, when the net benefits of the tax for a particular group exceed their costs to that group. (One can also think about this as how the share of benefits compares to the share of costs). This is why HB 179 is fair, even if it is linked to a rise in taxes.
HB 213 is unfair. The value of the harms done by increased consumption, in the first scenario, would be much greater than any money our poor and marginalized consumers would save from lower taxes.
If the Taxation and Revenue Committee really believes that it should reduce the taxes on some forms of alcohol “in the name of equity,” then I would suggest that the Committee amend this bill to take the same approach to tobacco, which is completely analogous. The Committee, could, for example, lower the taxes on cigarettes smoked by our marginalized communities or in the regions in which they live. The Committee realizes the terrible mistake that such an approach would be on tobacco and should also realize the terrible mistake it would be on alcohol.
The People Have Spoken – For HB 179
You heard this morning an astounding array of voices speaking out in favor of HB 179. This included numerous voices from the affected communities, people with lived experience, and people with substantial expertise in alcohol policy. They universally want you to make alcohol less accessible in New Mexico, not more accessible. As they see alcohol-related carnage on the roads, too many hospital beds filled by those with alcohol use disorders, and too many battered families caused by alcohol, they are imploring you to now take a sound and evidence-based approach to dealing with this matter.
HB 213 will Become a Case Study Worldwide on How Not to Do Alcohol Policy
I love New Mexico and am always saddened by references to its shortcomings in matters like alcohol-related deaths, interpersonal violence, or the poor quality of our schooling. I am not aware of successful efforts to reduce the harms of alcohol that were associated with lower taxes for some alcoholic beverages or that supported a windfall for the alcohol industry. The Committee should be aware that if it adopts HB 213, it is very likely that New Mexico’s taking this approach will become a case study in public health and public policy textbooks worldwide about misguided efforts to reduce the harms of alcohol.
Thank you for your service to New Mexico and for your consideration of this matter.
