Bring the California Alcohol Excise Tax into the 21st Century to Protect College Students

Students of the California State University (CSU) system keep finding themselves pieces in Sacramento’s bleak budgetary chess match. Last year, the legislature passed AB 840, which attempted to close revenue holes by handing Big Alcohol carte blanche to market directly to underage undergraduates on CSU campuses.

In 2022, the California Department of Tax and Fee Administration reported approximately $429 million in revenue from alcohol excise taxes. However, had the excise tax value kept up with inflation, the expected take would have been $952 million — an additional $523 million just from normalizing the current tax rate!

That half a billion would fill the CSU budget hole, with a little change left over to fund programs and remove any ostensible need to sell students' eyes to the industry. More importantly, it would modernize an alcohol tax that was last addressed during the first Bush administration in 1992.

This is more than just a pleasing symmetry. Not only are 40% of CSU students underage, but alcohol-related incidents are the leading causes of mortality for that age group. As of 2014, over 4,100 college-age young adults died annually of alcohol-related injury, including 2,614 from motor vehicle crashes. As for the other three acute causes of death, homicide and suicide are both strongly related to alcohol over-consumption, and alcohol greatly increases respiratory depression — and therefore overdose — from opioid use. On top of that, heavy and binge-drinking patterns are associated with a number of negative academic consequences — and underage alcohol use can get students punished by the school itself.

There are a number of environmental interventions that can bring these numbers back down, but one of the most forthright ones is, again, raising alcohol taxes. By moderately raising the typical price of a drink, alcohol tax hikes affect people involved in the most dangerous drinking problems, particularly cash-strapped heavy drinkers — which perfectly describes the college students in the cross-hairs of CSU’s bottle-pushing strategy.

Tell Governor Newsom today to index California's alcohol excise tax to the annual cost-of-living to bring that tax into the 21st century. It will help the budget and protect CSU underage students instead of selling them out to Big Alcohol.