MADISON, Wis. (WMTV) – During the pandemic consumer demand dropped for many goods, but there’s one thing Wisconsinites consistently put their money towards – alcohol.
According to new data from the Wisconsin Policy Forum, state excise tax revenues from the sale of alcohol rose by nearly 17% in 2021. That’s the biggest annual increase in nearly 50 years.
Todd Kacynksi, manager of O’Connell’s Lakeside Liquor, says in his decade of experience he’s never seen an increase in alcohol sales quite like the spike during the pandemic.
“With the pandemic there was a definite increase last year,” he said. “Our orders from our suppliers increased dramatically, absolutely.”
This surge in sales sparked the interest of researchers, like Mark Sommerhauser, at the Wisconsin Policy Institute.
While bars and restaurants were shut down, he explains that didn’t put as much of a damper on alcohol sales as some may think.
Sommerhauser lead the research on the alcohol excise tax revenue, and found it rose to nearly $74 million in Fiscal year 2021, which ended on June 30. According to the Forum, that’s a near $10 million increase from pre-pandemic times.
But in the context of the overall state budget, Sommerhauser say “that’s not a drop in the bucket but it’s also not a game changing, dramatic amount of money.”
That’s because Wisconsin taxes alcohol at a much lower rate than other states, and alcohol excise taxes in Wisconsin are based on the volume of beverage sold, rather than its price.
According to the forum, beer is taxed at approximately 6.5 cents per gallon; wine is taxed at 25 cents per gallon; and distilled liquor is taxed at $3.25 per gallon.
Kacynksi explains the taxes are paid before the liquor is even delivered to his store, and it is reflected in the prices customers pay at O’Connell’s and everywhere else.
To that end, when liquor stores sell more, “you could look at it and probably say it’s a positive for certain businesses that are retailers of alcohol,” Sommerhauser says.
But the revenue is a modest benefit for state finances.
The forum says excessive alcohol use is among Wisconsin’s longstanding health issues. Elizabeth Salisbury-Afshar with UW Health says there are many reasons people turn to alcohol. She says it helps people cope with stress, loneliness and bordum. She encourgaes people who are struggling with alcoholism or binge drinking to identify why they are dirnking and then find alterative activities.
“For different folks that looks like a lot of different things, it could be church, it could be going on a walk, it could be calling your mother, the list goes on and on,” she said. “It could be talking to your doctor about problems with sleep or anxiety. But really it’s about figuring out what alcohol does, what’s beneficial about it, and then coming up with alternatives.”
Sommerhouser hopes health care providers will look at this new data and work wih patients to address excessive alcohol consumption. In the meantime, he says there’s a chance these trends may go down.
“But we’re just going to have to see what the data shows in the months to come,” he said.
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