New Tactics to Push Beer Taxes

The mantra at the Oregon state capitol these days is “no new taxes,” so supporters of a new effort to capture more dollars from beer sales are giving their effort a different label. They’ve dubbed it a “Malt Beverage Cost Recovery Fee.”

Pointing to millions of dollars spent annually to cope with addiction and alcohol-related injuries and medical conditions, activists and Sen. Bill Morrisette, D-Springfield, say the state should boost beer taxes by more than 1,000 percent.

The current malt beverage tax in Oregon is less than a penny per 12-ounce bottle. Morrisette and the Oregon Council on Alcohol Abuse want to raise it to a dime per drink with the proceeds dedicated to cash-strapped county health departments, drug courts and law enforcement.

The likelihood for any increase is slim. Oregon hasn’t hiked its beer taxes since 1977 and the rate is among the lowest in the nation. However, the tactic of using semantics that sit better with the voter will likely spread to other states. The argument of “recovering” the costs of alcohol abuse may be an easier sell than “raising taxes,” although the results are equal.

Morrisette said he will place calls to the presidents of the nation’s biggest brewers in hopes they might respond to a plea to be good corporate citizens.

“We need them to call off the dogs,” he said. “In ordinary circumstances nothing will happen, but these are not ordinary circumstances.”

At a press conference, an activist who helped pass beer tax hikes in Alaska said Oregon’s rate is so low that it poses no barrier to teen drinking. “This insulting denigrating patronizing rate does not deserve to be dignified by calling it a tax,” Howard Scaman said. “We do not have a tax; we have a tax loophole.”

The low taxes mean kids can get their hands on cheap beer too easily, he said.

After the press event, Scaman hoped to create a political sideshow of delivering 12-packs of beer to Republicans in the state House.

However, the stunt was abruptly halted by State Police troopers because many of the legislators’ office staffers are underage.

At 8 cents a gallon, the beer tax is one-third of what Oregon collects per gallon of gas, according to the Washington D.C.-based Tax Foundation.

House Bill 2533 proposes a two-tiered tax rate that would collect more dollars from major producers that brew more than 200,000 barrels a year. Based on 2004 sales data, that means only buyers of three companies would face the higher tax of 10-cents per 12 ounces: Anheuser Busch, Coors and Miller.

Customers of smaller brewers would pay five-cents for each 12 ounces.

Paul Romain, a longtime lobbyist for beer and wine distributors, said his group would challenge such a system as unconstitutional because it is geared to collect more from businesses based out-of-state.