Mayoreo Blog

courtesy of Robert Altman

As the state deals with budget cuts, legislators are digging through the law books to find ways to make up for the growing deficit.

The House Taxation Committee heard testimony Friday for a bill that would double the gallon age tax on alcohol in an effort to aid mental health and disability programs affected by the cuts.
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State considers alcohol tax increase

A committee in the Kansas House of Representatives is considering a bill that would increase taxes on alcohol.

“In times like this our job is to look everywhere to find out the best way to balance the budget,” said State Rep. Jeff King, R-Independence, vice-chair of the taxation committee. “So I don’t mind that we’re looking at this and other taxes.”

Proponents of the bill point to the fact that the gallon age tax hasn’t increased since 1977, but alcohol wholesalers urge that the industry already contributes enough money to the state through other alcohol taxes.

The bill would double the tax on alcohol by the gallon from 18 to 36 cents for beer, 30 to 60 cents for light wine and 2.50 to 5.00 for hard liquor. That’s close to an extra 55 cents on a 30-pack of beer, or 75 cents a handle. Although the tax directly targets wholesalers, consumers can expect an increase in cost as store owners consequently implement price adjustments to accommodate the new tax. It is estimated the bill would generate approximately $22 million in revenue a year.

Philip Bradley, CEO of the Kansas Licensed Beverage Association, said that while the gallon age tax is a flat rate, the other three taxes – enforcement, sales and drink – are taxed at a percentage and therefore have adjusted appropriately to inflation throughout the years.

“The alcohol industry returns more revenue to the state of Kansas for every dollar that is spent in one of their places, than any other business,” he said. “And therefore it seems unreasonable to ask it to pay any more in this crisis.”

Bradley said he sympathized with the programs that are receiving less government support, but felt it was unfair to ask one industry to make up the lost funding.

“There’s absolutely no way any reasonable person believes that the alcohol industry should bear the burden for the state’s problem all alone,” he said. “And the money that would be derived from the gallon age tax is not going to be a drop in the bucket of what the deficit is going to be at the end of this year.”

Rep. Pat Colloton, R-Leawood, said that community mental health centers have seen cuts from $30 million to $10 million in the last year and a half, and that because of staff cuts, over 4,000 of the state’s developmentally disabled patients are on a waiting list for care.

“If you vote against this bill you’re saying it’s more important that they save a few pennies on beer and wine than it is to take care of our most vulnerable citizens,” she said.

Colloton said she didn’t think the minor increases would affect alcohol sales in any way, but opponents of the bill such as Bradley fear raised liquor prices would drive customers across state lines to get their booze.

King said the House Taxation Committee would debate and vote on the bill within the next few weeks.

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