Huge Alcohol Tax Hike Threatens Maryland Hospitality Industry, DISCUS Testifies

March 11, 2010 12:01 PM


Proposed Tax Would Cost 4,700 Hospitality Jobs

ANNAPOLIS, MD – The Maryland State Legislature is considering legislation that would increase the state alcohol excise tax by 568% – a move that will punish small businesses and destroy more than 4,700 jobs across Maryland’s hospitality industry, according to testimony from the Distilled Spirits Council. 

Under Senate Bill 717 and its companion bill in the House (HB 832), Maryland’s alcohol excise tax would skyrocket to $10.03 per gallon.  According to a recent Council economic analysis, the proposed rates represent a 568% increase over current taxation levels and would cause distilled spirits prices to rise by nearly 21%.  If enacted, the new excise tax rates would cause Maryland retailers to lose an estimated $281 million and put approximately 4,700 hospitality workers in the unemployment line.  

Distilled Spirits Council Vice President Jay Hibbard testified against the bills yesterday in the Senate Budget and Taxation Committee and today in the House Ways and Means Committee. 

“Responsible consumers of beverage alcohol already pay more than their fair share in taxes,” Hibbard said.  “The proposed excise tax increase would substantially raise prices for Maryland consumers, reduce retail sales revenue by hundreds of millions of dollars and put thousands of jobs at risk. The hospitality industry is an important part of Maryland’s economy and it makes no sense to spend tax dollars promoting tourism and then attack the industry with higher tax rates on beverage alcohol.”

Hibbard stressed that a tax on alcohol negatively impacts the entire hospitality industry – restaurants, hotels, bars, nightclubs and liquor stores, and the thousands of men and women they employ.  “When the state hospitality industry is already struggling, this is the wrong time, the wrong tax and the wrong people to punish with increased alcohol taxes,” he said.  “Legislators should be working to protect Maryland jobs, not forcing hundreds of people out of work with misguided tax hikes.”



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