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Originally Posted by CorsiHockeyLeague
Depends what you mean by "tax the crap out of it". We pretty much tax the crap out of cigarettes and to a lesser extent alcohol, but there aren't any underground speakeasies unknown to and unregulated by the AGLC springing up. Even if you double liquor taxes I doubt you'd see that happen, either.
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Actually, the government walked back cigarette taxes in the late 90s because high prices had fostered a huge black market in cigarettes. Shipments would come through Mohawk land and be distributed across the country. And extremely high taxes on alcohol in Scandinavia have led to a lot of people homebrewing spirits. Many Swedes also cross the border to Denmark or Germany to stock up on cheaper booze.
There's also a point at which you hurt local producers. I like craft beer. But as prices have risen steeply in the last few years, I've been cutting back on the $15 six-packs and going with the cheaper Coors Banquet option more often. Taxes won't price people out of drinking, but they can shape buying habits in ways that hurt the local economy.