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Jul 31, 2014

News

Wyoming defeats higher beer tax

Other Western states still considering tax hikes

Jan 30, 2003 - Legislators in Wyoming have voted against raising the tax on beer in that state, but in New Mexico a state senator has proposed a new tax and backed it with anti-alcohol rhetoric.

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All this comes at a time when state governments are face tax shortfalls and looking for additional revenue. Proposals have recently been put forth in Montana, Utah and Washington.

In Wyoming, the House Revenue Committee voted 5-3 against at bill that would have increased the beer tax from about 2 cents to 8 cents per gallon. The bill, sponsored by the Joint Interim Labor, Health and Social Services Interim Committee, would have earmarked proceeds from the tax — probably around $800,000 a year — to help pay for the state's substance abuse treatment plan, according to Rep. Jane Warren, D-Laramie, who argued for the bill.

She noted that at 2 cents a gallon, Wyoming's tax is by far the lowest in the nation, while neighboring Colorado's is third-lowest at 8 cents a gallon. Missouri's beer tax is second-lowest at 6 cents a gallon. Hawaii's is the highest at 93 cents a gallon.

But she was unable to overcome the argument from beer distributors that many credit for having kept the tax at 2 cents per gallon since the end of Prohibition in 1933: It hits the working man.

"Joe Six-Pack is the guy who's going to buy it, the working man in Wyoming who's making $30,000 and wants to buy a six-pack of Budweiser. He's the guy who's going to pay for it in the end," said Pat Higgins, president of the Wyoming Beer Distributors Association.

Mike Moser, representing the Wyoming State Liquor Association, said the tax, being based on volume rather than price, has a regressive quality that would hit working class people harder than those who buy more expensive beer. "Joe Six-Pack that buys cheap beer ... will be the hardest hit," Moser said. "The one that buys microbrews will be the least hard hit, because it's based on weight and not on price."

In New Mexico, Sen. Allen Hurt has introduced a bill that he said would "equalize" the excise tax on beer with the tax already placed upon wine and spirits. It would effectively increase the tax on a 12-ounce beer from a nickel to a dime.

Hurt has dubbed it the "Dime a Drink Damage Deposit," and he has included financial figures in the bill suggesting where and how the estimated $39.5 million in extra revenue could be used to reduce alcohol-related trauma throughout the state.

"If these manufacturers in Golden, Colo., and St. Louis and Milwaukee and elsewhere really cared about the damage their product creates, they would take the (medical treatment) money out of their corporate profits," he said. "For too long the alcohol industry has been able to have its keg and drink it, too.

"Beer-related alcohol abuse is the major creator of problems," Hurt said. "When people wind up in the trauma room it's not from drinking expensive vintage wine, it's from drinking lots of beer."


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