State Delegate William Bronrott and other delegates have filed House Bill 832, which, if enacted, would increase the state tax on alcoholic beverages and raise millions of tax dollars to be used to establish a Developmental Disability Support Fund, an Addiction Treatment and Prevention Fund, a Mental Health Care Fund, and a Medicare Trust Fund.   It is time to raise the tax on alcoholic beverages. This bill is cross-filed In the Senate as Senate Bill 717.

 

As of March 2009, at 9 cents per gallon, Maryland had the fifth-lowest beer tax in the United States. The United States median was $.185 and the average $.278. Maryland's tax on wine and liquor is equally low. Maryland’s wine tax is $.40 per gallon, $.39 below the national average. Our liquor tax is tied with the District of Columbia's as the lowest in the nation for those states t hat tax liquor (some states sell alcoholic beverages through state -run stores and mark up the products without taxing them). At $1.50 per gallon, it is a whopping $2.42 below the national average.

 

If the level of these taxes appears antiquated, it is. The last time Maryland increased the tax on beer and wine was when Richard Nixon was president in 1972. Maryland hasn't raised taxes on liquor since Dwight David Eisenhower was president In the 1950s. Today, the tariff is approximately $.02 per glass of wine or ounce of liquor and $.09 on a mug of beer.

 

Putting aside the positive effects that a reduction in drinking would have on public health, as asserted by numerous health advocates, an increase in alcohol taxes could have an impact on the budget shortfall in Maryland. Researchers at the Johns Hopkins University Bloomberg School of Public Health, in a study funded by the Abell Foundation, reported that a $.10 increase per drink would result each year in taxes of $270 million. The sponsors of HB 832 estimate that their bill will raise $200 million in taxes.

 

Following the upcoming election year, like it or not, there will be a plethora of increased taxes in this state. There is simply no good reason not to raise the tax on alcoholic beverages this year, but lobbyists for the liquor industry have fought hard against an increase in taxes. They cite increased costs of doing business, business lost to neighboring states, no adverse effect on the consumption of alcohol, and thus the public health, and a reduction in tax revenue if taxes increase. Nor do our legislators want to face their constituents in an election year having voted to raise taxes.

 

With rates near the lowest in the nation, there is room to increase taxes and raise revenue. Taxes on these products in neighboring states are higher than in Maryland, with the exception of the District of Columbia. There is no good reason to provide a bargain of this magnitude for alcoholic beverages -- a non-necessity for all Marylanders.

 

Maryland needs the money. Lawmakers should ask their constituents whether they would support such a tax increase. They should not be dissuaded by those who represent the alcohol beverage industry, and each year successfully lobby against an increase in the tax. An increase is inevitable and should occur sooner rather than later.