SANTA FE, N.M. – It’s been more than 30 years since state lawmakers last updated New Mexico’s alcohol taxes. They came close last session, and people came into this year wondering if a plan was in the works.

New Mexico has more than 2,000 alcohol-related deaths every year – that doesn’t include DWI arrests and other alcohol-related incidents.

Lawmakers debated whether higher taxes stop people from drinking as much, but there’s been a growing sense that they have to do something with an outdated tax scheme.

One group of lawmakers wants to raise the current tax, which distributors pay based on the volume of alcohol sold.

BREAKING IT DOWN

It would amount to about 12 cents a drink. In this system, the more you drink, the more you pay: supporters suggest that this increase would lead to a 5% decrease in the amount of alcohol sold statewide while also bringing in millions of dollars for alcohol programs.

“We have almost $300 million in need in our state for programs and prevention, and treatment, and recovery. This $150 million will only satisfy half of that, but we think it would be a good start if we can get this through,” said state Rep. Joanne Ferrary. 

The other proposal would instead tax alcohol based on the retail prices:

• 2% for beer
• 3% for wine
• 4% for liquor

That means more expensive booze would have higher taxes.

The bill would also fund treatment programs. But when it comes to reducing consumption, the sponsor argues the data just doesn’t support a major tax increase.

“The research is pretty solid for white people. But Hispanic people and Black people, they’re just not responding in the same way, they don’t have the same price sensitivity. I would argue it’s because of the deeply held trauma and poverty in our state,” said state Rep. Micaela Lara Cadena.  

The House Tax Committee discussed both proposals Wednesday. The committee plans to get at these proposals Friday morning, but time is running out.