Consumers Threaten Rebellion Over Alcohol Tax Hikes August 15, 2008
News Summary
Taxes on alcohol remain a popular option among legislators in revenue-strapped states because they don't affect all consumers, but those affected by increases recently imposed in several states appear to be pushing back, the Wall Street Journal reported Aug. 15.
Opponents of a 10 percent tax imposed in January on retail sales of alcohol in Allegheny County, Pa., are seeking to place on the November ballot a measure that would reduce the tax to no more than 0.5 percent. "They whacked an onerous 10 percent tax on a product that already has more taxes and fees on it than anywhere else in the country," said Kevin Joyce, a downtown Pittsburgh restaurant owner leading the charge on what is being called a Whiskey Rebellion II. Various taxes on alcohol in Pennsylvania include a tax that was imposed in 1936 to finance repairs to flood damage and is still in effect today.
In Maine, a group called Fed Up with Taxes has collected 90,000 signatures in an effort to repeal beer and wine taxes that are supporting a state health insurance program. According to the Distilled Spirits Council of the United States, other attempts to impose new alcohol taxes are not advancing through legislatures, with 24 of 33 proposals failing this year.
Kim Rueben, an economist with the Tax Policy Center, speculated that alcohol taxes are coming under fire because of widespread rising costs for other consumer goods. "People feel besieged," Rueben said.
But some individuals in Allegheny County are worried that if alcohol taxes are rolled back, lawmakers will increase the property tax burden to offset the revenue loss. Whiskey Rebellion II in Pennsylvania faces a protest of its own from Citizens Against Raising Taxes on Property, a group financed largely by the real estate and development industries.
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