25 Investigates: Beacon Hill task force pushes alcohol tax hike

BOSTON -- A special task force is pushing to hike a hidden task on alcohol in Massachusetts – a plan that Investigative Reporter Eric Rasmussen has been looking since it was quietly rolled out just before the new year.

If a Beacon Hill booze tax hike sounds familiar it’s because lawmakers already tried to charge more for alcohol by putting a sales tax on beer, wine and liquor in 2009. But angry voters repealed that alcohol sales tax in 2010.

Now, a task force formed by State Treasurer Deb Goldberg is encouraging lawmakers to increase the hidden tax that’s already part of what you pay for alcohol.

Increasing the excise tax on alcohol is one of 37 recommendations in the task force’s Dec. 28 report.

25 Investigates read every page of the 288-page report, which pushes for raising the alcohol excise tax by 50 percent – a proposed levy estimated to haul in an extra $41 million from consumers per year.

Macey Russell, who Goldberg appointed as task force chairman, insists increasing the excise tax on beer, wine and spirits would only cost the consumer a few pennies more per drink.

“An excise tax really isn’t a tax technically… if you look at the case law interpreting excise tax,” said Russell.

But Investigative Reporter Eric Rasmussen asked, “Do you think the average beer buyer is going to look at that as not a tax?”

Russell told 25 Investigates, “I would hope so because they don’t see the tax on their bills.”

He’s right about that part – the excise tax on alcohol never shows up on your receipt.

The excise tax is added to the cost of alcohol when it comes into the state. It’s already part of the price when the wholesaler decides how much to charge the retailer – or liquor store – and when the retailer marks it up again to sell to the customer.

Supporters of the tax hike say higher alcohol prices lead to less alcohol abuse, but 25 Investigates found studies cited in the task force’s report rely on surveys about alcohol use that are decades old.

Russell says the extra tax money could pay for more state alcohol investigators and alcohol abuse prevention.

“If we’re smart and we do things the right way and we take this money and we designate it for a purpose, then I don’t think people in the Commonwealth would object to that,” said Russell.

But liquor store owners told 25 Investigates they are opposed to a potential tax hike.

“It’s not fair and it’s not needed,” said Ben Weiner, whose family has been in the liquor store business more than 50 years at Sav-Mor Liquors in Somerville.

Weiner worries the proposed tax hike on alcohol could have a bigger impact on his customers than predicted and he doesn’t trust lawmakers to spend the extra money in the way a task force suggests.

“No matter what they say, the money's going into the government pot and it’ll be spent by whoever and however they wish,” said Weiner. “That’s the way it is.”

State Treasurer Deb Goldberg recently asked lawmakers for more money, citing the task force’s report to increase the budget for the ABCC – which she oversees.

“By any measurement, the Alcoholic Beverages Control Commission is woefully underfunded and understaffed,” Goldberg told the Joint Committee on Ways and Means earlier this month.

But 25 Investigates got conflicting answers from Goldberg and Russell, the chairman she appointed, about whether the treasurer actually supports the task force's recommendations.

Russell told 25 Investigates Goldberg already read his report but said the two haven’t had a chance to sit down and talk about it yet.

But Goldberg said she’s only “flipped” through the report.

“I have not seen that report. I gather I’m seeing it soon,” said Goldberg.

When asked if she was in favor of increasing the tax on alcohol, Goldberg told 25 Investigates, “I have no idea. I’m not going to answer that question because I don’t know the context it’s in.”

A spokesperson for the Treasurer’s Office later told 25 Investigates Goldberg is waiting on analysis before deciding what steps to take next – including whether she’s looking to draft a bill to increase the alcohol tax.

Russell says the current tax rate on alcohol in Massachusetts ranks among the lowest in the country and customers aren’t likely to even notice a tax hike.

But some consumers told 25 Investigates they’re not buying it.

“It’s ridiculous,” said Jim Fahey of Foxborough.

“They have their hands way too deep in our pockets as it is,” said Concord resident Jim Ambrose.

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