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Alcohol Tax Threatens Cook County Hospitality Industry

October 26, 2011 02:02 PM

 

Spirits Consumers Face 4th Tax Hike Since 2005


CHICAGO, IL – The Distilled Spirits Council (DISCUS), representing thousands of spirits brands sold in Illinois, today blasted Cook County’s proposal to raise spirits taxes calling the 25% hike a major job-killing burden on Chicago’s hospitality industry.


“Forcing bartenders and busboys into the unemployment line is no way to shore up the county budget,” said DISCUS Vice President Dale Szyndrowski, noting that hospitality businesses in the Chicago area are still down 13,000 jobs since before the recession.  “Raising taxes should not be the answer to every problem in Cook County. It’s time to say enough is enough.”


Szyndrowski said this increase would mark the fourth alcohol tax hike on Chicagoans since 2005, including two city tax increases (2005, 2008) and one state excise tax increase (2009) which nearly doubled taxes on spirits.


Under Cook County Board President Toni Preckwinkle’s proposal, the current county excise tax on spirits would increase 25% from $2.00 per gallon to $2.50 – further increasing an already staggering tax burden on Chicago-area consumers. 


Szyndrowski pointed to an economic analysis showing that a Chicago restaurant patron already pays eight different direct taxes with each purchase, including: Federal Excise Tax ($13.50/proof gallon), State Excise Tax ($8.55/gallon), County Excise Tax ($2.00/gallon)*, City Excise Tax ($2.68/gallon), State Sales Tax (6.25%), County Sales Tax (1.25%), Transport Tax (1.00%) and City Sales Tax (1.25%).  He also noted that 58% of the purchase price of a typical bottle of spirits in Illinois already goes to taxes.


“Hamstringing the hospitality industry with higher alcohol taxes will cost jobs and hurt tourism throughout the state,” Szyndrowski said, noting that another tax increase will likely drive tourists and business travelers into nearby Wisconsin and Indiana.


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*Under the Board’s proposal, the county excise tax would increase from $2.00/gallon to $2.50/gallon – a 25% increase – and make spirits taxes in Chicago 85% higher than spirits taxes in New York City.

 

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