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What happens when it’s the state selling the booze?

States that directly control their own alcohol sales through state-run liquor stores get more revenue from booze than states like Alaska that issue liquor licenses to private retailers, the University of Michigan has found.

Unlike Alaska, which takes its cut of the alcohol business through high taxes, some states also directly handle wholesale and/or retail alcohol sales within their borders. The tighter the government monopoly on liquor, the more money for public coffers and the less wine and spirits people drink, the university’s Institute for Research on Labor, Employment and the Economy reported in May.

“In monopoly states, spirits consumption is 11.9 to 15.1 percent less than in license states, and wine varies from 61.0 percent less to 9.9 percent less, depending on the control model,” the researchers wrote.

Federal Funds Information for States, a non-profit that provides budget analysis for state leaders, highlighted the data in a recent reportEighteen states exert some level of government control over wholesale alcohol sales, the group says.

The FFIS report says alcohol tax revenue in Alaska grew by more than 50 percent between 1977 and 2010, the fifth fastest growth in the country. Alaska tobacco tax revenues grew the fastest in the U.S. over the same period.

Originally published January 7, 2014 by KYLE HOPKINS in Anchorage Daily News.

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