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Beating the heat, if not taxes, with cooling cocktails

June 21, 2019

Texas seasons (2)

The summer solstice has finally caught up with Texas temperatures.

The first day of the sunniest season arrived today at 10:54 a.m. Central Time. By then, here in Austin we already were at nearly 90 degrees. It wasn't much of a climb for the thermometer, since our overnight temps for the last week or so have been hovering in the 80s.

By the time we get to mid-afternoon, it will feel like triple-digit heat for the third straight day.

That's why so many of us are thinking of heading to the Texas Gulf Coast, or as we called it when I was a kid in desert West Texas, the ocean. It still will be hot there, but at least we can kick off our flip-flops and splash around on the beach.

2009-11-19 13.59.10

The tax price of booze: Or we could stay in our air-conditioned homes and enjoy some tropical libations.

Here in Texas, beer is always a safe bet. But if you prefer some fancier potent potables, the Lone Star State's unofficial state cocktail is the margarita.

That, of course, calls for tequila. Lucky for us Texans, there are plenty of local and imported options.

Also lucky for us libation favoring Lone Star Staters, we have a relatively low excise tax rate on distilled spirits.

The Tax Foundation created the distilled spirits tax map below to give us an overview of where you'll pay more, thanks to state taxes, for your mixed drinks.

Distilled spirits tax rates by state_The Tax Foundation

Lowest liquor taxes: There's good news for imbibers on either side of the United States. Wyoming and New Hampshire are the places to be if you want cheaper cocktails.

"These two control states gain revenue directly from alcohol sales through government-run stores and have set prices low enough that they are comparable to buying spirits without taxes," reports the Washington, D.C.-based tax policy group.

Missouri taxes are the next lightest at $2.00 a gallon, followed by Colorado at $2.28 per gallon, Texas at $2.40 per gallon and Kansas at $2.50.

So my fellow Texans, pick up a bottle of tequila with its relatively low tax rate, find your shaker of salt and, if you're a frozen 'rita aficionado, crack the ice and crank up the blender!

Pricier potent potables: So where will you pay more for your mixed drinks' main ingredient?

Washington State leads the country with an excise tax rate on distilled spirits of $32.52 per gallon, says the Tax Foundation. At least that Pacific Northwest state has legal recreational marijuana, but you won't get off the tax hook there. Pot is also taxed at a 37 percent sales tax rate.

The Evergreen State's high alcohol tax rate is followed by neighboring Oregon, with its $21.98 per gallon rate. Like Washington, your choice of mood alterations in Oregon includes weed. And like Washington, the Beaver state also assesses a sales tax, although lower at 17 percent, on personal use marijuana purchases.

The top five list of states with the highest liquor taxes in the country is rounded out by Virginia at $19.93 per gallon, Alabama at $19.15 per gallon and Utah at $15.96 per gallon.

Personally, I'm more of a brewski fan, which pleases the Texas tax collector. My native state ranks higher nationally when it comes to beer taxes than it does in comparison to distilled spirits levies.

Kays beer collection

But it's a price I'm willing to pay, especially on the many hot Texas summer (and beyond!) days.

Salud!

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The More Tax Posts tab at the top of this page will take you to, well, more tax posts. You also can search below for a tax topic. 

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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