DISCUS

Boston City Council Considering Yet Another Regressive Hospitality Tax

December 13, 2016 09:24 AM

Proposed Tax Hike Would Kill Jobs, Hurt Consumers, Drive Business out of Boston

The Distilled Spirits Council today objected to the revived proposal for a substantial citywide tax increase on the sale of alcohol – beer, wine and spirits –which would give Massachusetts one of the highest sales taxes in the country.

Following a similar proposal that was soundly rejected last year, this new two percent tax proposal would hurt the city’s hospitality industry by putting Boston area merchants at a significant competitive disadvantage compared to bars, restaurants, hotels and stores in bordering cities and towns.

"There is ample evidence that the public does not want this massive tax hike," said Distilled Spirits Council Vice President Jay Hibbard. "If the city council moves forward, they will be ignoring their constituents and instituting double and triple taxation on alcohol. Ultimately, this will endanger jobs, limit sales and hurt responsible consumers in Boston."

An economic analysis by the Distilled Spirits Council indicated that the proposal is projected to cost the city nearly $10 million in lost sales and over 130 jobs. In addition, this tax legislation stands in stark opposition to the results of the 2010 statewide referendum where voters decided to exempt alcohol from the state sales tax.

Hibbard pointed out that the proposal to impose an additional sales tax in Boston comes despite the fact that 47 percent of the retail price already goes to pay taxes of some kind for a typical bottle of distilled spirits sold in Massachusetts. On-premise sales of alcohol are also already subject to the state's 6.25 percent sales tax and a 2 percent additional meals and lodging tax. Adoption of this new tax would bring Boston's sales tax to 10.25 percent, making it one of the highest sales taxes in the nation.

This onerous taxation plan has been widely criticized across social media channels with many commenters weighing in with statements such as, “People already voted on this and said NO!” and “This is a regressive tax and should be opposed. The city already has a meals tax. Enough is enough.”

Hibbard concluded, "Responsible consumption of distilled spirits, wine or beer is a socially acceptable part of a normal, healthy, adult lifestyle. Imposing new taxes on responsible consumers is not good public policy.”

 

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