Taxes on an adult beverage will cost you in Mississippi

By Aaron Rice
June 22, 2020

An adult beverage is generally one of the easiest items for lawmakers to tax, and Mississippians pay for it every time they purchase beer, wine, or liquor. 

The same is true of virtually every state in the country, where excise taxes are paid on top of the traditional sales tax. 

When it comes to alcohol, Mississippians pay $8.11 per gallon in excise tax on their favorite wine or other beverage. That is 18th highest in the nation. Residents of Washington pay the most – $33.22 – per gallon. Among neighboring states, Alabama residents pay $19.11 per gallon, the highest in the south. Louisiana has one of the lowest rates at $3.03. Tennessee residents pay $4.46 while Arkansas pays $8.41. New Hampshire and Wyoming do not have an excise tax. 

These rates may include a wholesale tax rate converted to a gallonage excise tax rate; case and/or bottle fees, which can vary based on size of container; retail and distributor license fees, converted into a gallonage excise tax rate; as well as additional sales taxes.

When it comes to beer, the southeast generally pays higher tax rates than the rest of the country. And Mississippi moves up to the 12th highest excise tax rate in the country. We pay $0.43 per gallon. That’s not as bad as Tennessee, who has the highest rate in the country at $1.29 per gallon. I guess they want to make sure you're skipping beer and going straight to Jack Daniels. Alabama is third at $1.05. It’s $0.34 per gallon in Arkansas and $0.40 in Louisiana. Wyoming has the lowest rate at $0.02. 

Excise taxes are paid prior to the point of sale. But although you can’t see it in on your receipt, every vendor who is taxed passes these costs along to the consumer in the form of higher prices for their product. Taxes on beer are so high that it is estimated that 40 percent of the retail price goes toward taxes. 

Remember that next time you purchase a six-pack. 

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