DISCUS

State Senator Introduces Bill to Stop "Stealth" Tax Hikes

February 2, 2010 12:05 PM

OLYMPIA, WA – A bill that would prevent the Washington State Legislature from forcing an increase in the markup on distilled spirits has been introduced in the state Senate, according to the Distilled Spirits Council – which applauded the legislation and referred to markups as “stealth taxes” that penalize consumers with higher prices. 

Senate Bill 6744, sponsored by State Senator Curtis King, R-Yakima, prohibits the WLCB from increasing the markup on distilled spirits products.

“State government should be open and transparent,” said King. “The result of removing funds from the Liquor Control Board’s fund had the effect of a tax increase and that’s not how government should operate.”

The legislation calls the act “necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions.”  The bill would take effect immediately upon passage.

“While some legislators may consider it their right to use the spirits tax markup as an ATM, the fact is that increasing the markup is a stealth tax on Washingtonians,” said David Wojnar, Vice President of the Distilled Spirits Council.  “It happens behind closed doors, doesn’t require legislative approval, and leaves Washington consumers picking up a huge tab.  Legislators aren’t pulling the wool over anyone’s eyes here – markups are taxes.  We applaud Senator King for recognizing that markups, like taxes, should have fingerprints.” 

Wojnar noted that state legislators last year took $80 million from the WLCB’s successful revolving fund – forcing the agency to propose a major price increase via a spirits tax markup to shore up the difference.  Wojnar said the move violated the spirit of I-960 which would have required a two-thirds vote by the Legislature to enact a liquor tax increase.  The money-grab, he said, forced the WLCB to increase the markup and resulted in Washington consumers having to pay $2 more per bottle on many popular bottle sizes and brands since August.

 

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