We propose a general method that allows the identification of the policy maker’s unobserved preferences when setting different excise tax rates to differentiated products. We use it to evaluate excise beer tax policy in the Canadian province of Ontario, identifying the government’s preferences over the total surplus and net externalities associated with the production and consumption of different types of beer products (i.e., local craft beer vs. large manufacturers’ beer). We also identify the increasing share of local craft beer consumption with respect to household income as a unique source of the regressiveness of differentiated excise taxes.