Alcohol

Excise Tax Rates

The beer tax in Iowa was enacted with the repeal of prohibition in 1933 and is based on the sale of beer to retail outlets. The tax was originally set at $.04 per gallon sold. In 1947, the tax was increased to $.08 per gallon and again to $.12 per gallon in 1967. In 1971, the tax was increased to $.14 per gallon ($4.34 per 31 gallon barrel) and on July 1, 1986 it was changed to $5.89 per barrel ($.19 per gallon) where it remains today. Iowa code 123.136. Revenue from Iowa's beer tax is collected by the Division and transferred to the state's general fund.

The wine tax in Iowa was enacted with the privatization of the wholesale of wine in 1985. The tax, originally set at $1.50 per gallon, was raised to $1.75 per gallon July 1, 1986 and is collected from wine sales to retail outlets. Iowa code 123.183. Revenue from Iowa's wine tax is collected by the Division and transferred to the state's general fund.

Tax on distilled spirits in Iowa is levied through a 50% mark-up on product sold through the Iowa Alcoholic Beverages Division wholesale liquor distribution system. The mark-up system was enacted with the privatization of state stores in 1987 and was originally set at 60%. The General Assembly reduced the mark-up to 50% later that year in April 1987. Iowa code 123.24(4).

How do excise taxes in Iowa compare with other states across the country? Iowa currently collects the 3rd highest wine tax and the 25th highest tax on beer. Because Iowa collects a 50% markup on distilled spirits as one of 18 control states, no specific ranking system renders an applicable comparison to the other 32 license states that collect a flat per-gallon excise tax.

Beer: State by State Comparison

Wine: State by State Comparison

Liquor: State by State Comparison

Beer Excise Tax FY13Wine Excise Tax FY13

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