Monday, June 14, 2010

Rant: Repeal the Alcohol Tax

I was disturbed when reading a recent article that stated: "New poll results reveal that the majority of Massachusetts voters oppose repealing the alcohol tax." Is that truly the case? Do our citizens enjoy paying taxes, especially on an item that a year ago was tax-free?

Effective August 1, 2009, a 6.25% tax went into effect on all alcohol sales. Alcohol had previously been free of tax so this was a drastic change. The new tax has adversely affected a number of wine stores, causing a number of people to now buy their alcohol in tax-free New Hampshire. Rather than increasing taxes on alcohol, the state government should have been doing more to cut waste.

Efforts to repeal the alcohol tax were underway soon after the law was enacted, if not beforehand. The repeal initiative gathered a sufficient number of signatures but the Massachusetts Legislature chose not to approve it by the May 4, 2010 deadline. So now sufficient signatures must be obtained by July 7, 2010, to try to get the matter on the ballot for November.

But even if the repeal measure makes it to the ballot, will the citizens of Massachusetts support the repeal? The Campaign for Addiction Prevention, Treatment, and Recovery recently retained Anderson Opinion Research of Boston to conduct a poll for them. The poll, conducted May 3-5, reached 450 likely voters, and 58% were against repealing the alcohol tax while 36% supported the repeal and 6% were undecided. 72% of Democrats opposed the repeal while only 50% of the Republican opposed it. The poll also concluded that the majority of people would support a ballot question to lower the state sales tax from 6.25% to 3%.

The Campaign for Addiction Prevention, Treatment, and Recovery wants the alcohol tax money to go to a fund for treatment of substance abuses. The tax will supposedly generate $50-$100 million. So they do have a vested interest in this matter, desirous of the revenues to help their cause.

But, Suffolk University and 7News conducted their own poll of 500 registered voters and the results were very different, that 48% of the people supported repealing the alcohol tax, 43% opposed it and 9% were undecided.

So why the different results from the polls? Partially it may depend on the question that was asked of the respondents. It may also depend on the demographics of the respondents, information that I do not have presently. These were also small sample sizes. I question their accuracy, but it is worrisome that maybe plenty of citizens do oppose a repeal. But why do they oppose it? Their rationale is not explained in these polls.

Do they feel the added price helps to reduce underage drinking? Do they feel it is a justified "sin tax?" Do they feel the money is necessary for funding the treatment of alcohol-related diseases? Does the opposition primary consist of non-drinkers? I just don't understand why people who buy alcohol frequently would want to maintain the tax.

I think the alcohol tax should be repealed. I think our economic situation would be better because of it. What do you think?

1 comment:

Couves said...

I agree – repeal it. Alcoholic beverages were already subject to the excise tax at the level of production. So the new sales tax is essentially a double tax. The sales tax is also a bad idea because it could potentially be increased in the same way we’ve seen with the cigarette tax. Some politicians want to do the same thing with candy and soda – use high taxes to decrease consumption. Many countries already impose punitive taxes on beer, wine and spirits. In today’s political environment, it’s easy to see the same thing happening here.