ediblenapalm
New Member
Lawmakers shouldn't tap plan for massive increase
The legislative proposal to drastically increase the state's tax on beer has received an ice-cold reception here in Beervana.
That's understandable. The proposed increase is too high, and it makes beer drinkers responsible for societal ills that beer might not have anything to do with.
But the widespread bitterness for the tax increase also is semihumorous. After all, taxing beer is not like taxing milk. No one needs beer. Still, a 33-year-old city employee in a brewpub recently told an Oregonian reporter that beer drinkers should not be singled out and suggested that a tax on various groceries would be more fair. Of the beer tax he said, "Put it on vegetables, man."
I am not making this up.
At the same time, when it comes to cigarettes, a lot of Oregonians -- perhaps many of the same Oregonians fighting a beer tax increase -- insist on hefty taxation. They rail on about how smokers' unhealthy choices need to be charged (paying no attention to the cost savings associated with smokers dying younger than the healthy population). The nonsmoking majority has gone so far as supporting a law that forbids smoking in private businesses, even if people never have to frequent a smoky joint and even if no wait staff ever has to serve a smoke-filled area.
While beer fans have organized vanpools to public hearings in Salem using Facebook and Twitter (the group No New Oregon Beer Tax on Facebook boasted 3,117 members as of Wednesday), Gov. Ted Kulongoski's idea to put a sizable increase on a pack of cigarettes is sitting pretty well with the public.
Right now the tax on a pack of smokes is $1.18. Kulongoski and other lawmakers want to add on another 60 cents per pack and levy a 25 percent increase in other tobacco taxes. Where is the outrage? Those who belly up to smoke-free bars ought to think about the double standard.
Smokers are popular targets for tax increases, even though increasing tobacco taxes often burdens those least able to pay. Smoking is often associated with lower incomes. If smoking is as addictive as society claims, will taxing cigarettes at higher and higher rates cause people to quit smoking or just make them poorer? We can't have the addiction argument both ways.
But back to reasons to be against the higher beer tax:
Proponents of adding 15 cents to every 12 ounces of beer make the case that Oregon has one of the lowest tax rates on brew. But going from a state with one of the lowest taxes on beer to the highest in the nation is radical.
Lawmakers should have proposed a much, much smaller increase. It might have been palatable to the public, if not brewers.
Even though proponents of the higher tax talk about it in terms of mere pennies, brewers offer a more informative perspective: 15 cents per 12 ounces of beer adds up to $51 on a barrel of beer. The current tax on a barrel is $2.60. As brewers are pointing out, that's a nearly 1,900 percent increase.
It's not hard to see that an increase of this size could throw off business dynamics considerably.
Kurt Widmer of Widmer Brothers Brewing told The Oregonian recently, "The lie of the 15 cents is that a pint (actually) goes from $4 to $5.50." And as Irene Firmat and Gary Fish, founder of Full Sail Brewing Co. and president of Deschutes Brewing Co., respectively, wrote in a Feb. 22 guest column: "The state says it needs money for drug and alcohol treatment programs. The current excise taxes for beer and wine, and the profit from the state liquor stores, generate $156 million a year. About $8 million of the amount collected today is used for these programs.
"The state could choose to fund these programs with the current excise taxes, but instead it has chosen to divert these taxes from treatment programs."
Lumping beer in with behaviors such as meth addiction also has backfired on lawmakers.
Proponents of the tax say the extra money flowing from beer would go to treatment, recovery and prevention of drug and alcohol abuse as well as drug and alcohol treatment for inmates.
But as Widmer said, "I'm not sure why beer drinkers should be solely responsible for funding meth rehab." (By the way, the 3-cent-per-glass tax on wine is not being fiddled with.)
Lawmakers should resist this dramatic tax increase on beer. They probably will. Portland's beer drinkers have a lot more clout than those societally scorned low-income smokers.
http://www.oregonlive.com/hovde/index.ssf/2009/02/oregons_tax_on_beer.html