Where Is Wine Your Friend? Ask Uncle Sam.

 


Some United States wine buyers are subject to hefty tariffs. Others can hold onto more of their hard earned cash. Can you guess which state gets the most take from your bottle purchases? The results may surprise you.

According to a Tax Foundation study, the tax code varies not only by state but also by alcohol level. Alcohol level is directly proportional to total tax. Meanwhile, sparklers can carry more tax than any other type of wine. Check your wallet before you tap the cork or twist the cap.

The Foundation’s study measured state tax dollars by gallon of 11% ABV, non-carbonated wine. The numbers do not include federal tax dollars. (It is refreshing to know that one can still find 11% ABV wine in the United States.)

The lowest state tax on wine is in Louisiana; they require a paltry $0.11 per gallon. Coming in behind Louisiana are California, Texas (both at $0.20 per gallon), and New York ($0.30 per gallon). On the high end, Florida clocks in at third from the top with $2.25 per gallon. Meanwhile, Alaskans are feeling the heat at $2.50 per gallon. The highest state tax is inKentucky, at a whopping $3.18 per gallon.

Numbers like these beg the question: Are state taxes commensurate with consumption? Look at the statistics: District of Columbia residents consumed twenty-six liters of wine per person in 2013, according to a study by the Beverage Information Group. That’s the greatest number of wine bottles per person in the entire nation. Their tax rate is on the high side, at $1.61 per liter. That makes a world of sense. New Hampshire and Vermont are not far behind; they consumed 25.7 and 19.6 liters, respectively. The Tax Institute did not provide state tax information for New Hampshire because it is one of a few states that controls all of its liquor sales.
Vermont claims a $0.55 tax per liter, which is on the low-end. That’s a very forgiving number in a state that loves its wine. West Virginia doesn’t drink much wine at all; their annual consumption was 2.4 bottles per person, and their state tax per liter is one dollar. Is there a true correlation here? Perhaps one exists, but it must be on a case-by-case, state-by-state basis.

Florida, one of the high tax states, consumed 12.4 liters of wine per person. That’s nearly equal to one of our low tax states, California, where they consumed 13 liters per person in 2013. And the highest tax state, Kentucky, is fifth from the bottom of the consumption list with 3.8 liters per person. Kentucky may wish to dissuade wine drinking in favor of bourbon. Meanwhile, Louisiana, the lowest tax state, consumed a mere 5.7 liters of wine per capita. Louisiana should consider drinking more Sangria during Mardi Gras.

The collation of these two data sets shows no consistent relationship between state wine tax and consumption. Maybe there should be one. What do you think?

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