High Taxes and Tight Restrictions Fuel Demand for Illegal Booze: New at Reason

One enduring image of Prohibition is that of people sipping bathtub gin—illegal booze of dubious quality and safety, cooked up to satisfy the thirst of drinkers in an America that tried to ban alcoholic beverages. Bathtub gin was the result of regulators trying to eliminate access to a popular product, inevitably inviting supply to meet demand in the black market.

But you don’t need an outright ban on alcohol to fuel the production of bathtub gin and its equivalents, notes J.D. Tuccille. A new report shows that the same result has been achieved in many countries through the imposition of excessively high taxes and overly restrictive regulations.

If you don’t want a black market in booze to develop, keep the tax man on a leash and regulators in check, argues Tuccille. And then, maybe, you can avoid repeated iterations of Prohibition and the bathtub gin it made so famous.

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