Weeks after a tax increase on cigarettes, a bill is making its way through the state House that would increase the tax on a 12 oz. beer from less than a penny to around 10 cents for most major breweries. The proposed bill would raise a projected $60 million in state revenues that would be used for prevention, treatment and enforcement of drug and alcohol abuse.
Beer bill to increase tax on major brews
Weeks after a tax increase on cigarettes, a bill is making its way through the state House that would increase the tax on a 12 oz. beer from less than a penny to around 10 cents for most major breweries.
The proposed bill would raise a projected $60 million in state revenues that would be used for prevention, treatment and enforcement of drug and alcohol abuse. The tax would raise the tax on all companies that sell over 125,000 barrels of beer annually.
Oregon is currently paying little for the problems relating to alcoholism and addiction treatment funding, according to sponsor of the bill and state Rep. Jackie Dingfelder (D-Portland).
“We spend $683 annually,” said Dingfelder, about how much Oregonians pay for alcoholism treatment. “Current revenues cover one dollar out of every $39 of that cost. This should cover some of the costs of alcoholism.”
The tax would also discourage underage drinking, Dingfelder said, a larger problem in Oregon than in many states.
“We have a problem with youth binge drinking,” said Dingfelder. “If you raise the cost of cheap beer, it decreases the amount of underage drinking.”
The tax is an incentive for people to drink less, according to Don Bishoff, the legislative assistant to Bill Morrisette, the bill’s other chief sponsor.
“There’s studies to show that problem drinkers use cheaper beer and 80 percent of beer sold in Oregon comes from larger breweries,” said Bishoff. “Instead of society as a whole paying through higher income tax, a malt beverage recovery fee. If you’re drinking from a large brewery you pay the tax, cans and bottles and kegs.”
Because the tax specifically targets larger beer companies, Oregon microbreweries would not be affected, said Bishoff.
“There’s an exemption for small breweries,” he said. “In effect the bill says any brewery that sells less than 125,000 barrels would never have to pay the tax.”
Currently the tax on beer in Oregon is one of the lowest in the nation, having not seen an increase since the 1970s.
“It’d be a hefty increase, but there hasn’t been one for 30 years,” said Bishoff. The proposed tax would allow revenues to align with the cost of inflation.
As with the recently passed cigarette tax, local support for the proposed beer tax is mixed.
“I’m against it, just like I’m against all taxes,” said an employee of a local Plaid Pantry. “If you’re going to raise the tax, raise everyone’s through an income tax. Taxes should be divided equally.”
Students at Portland State have a more positive outlook on things, saying that since the tax only targets major beer companies and is for a good cause, it seems logical.
“Oregon has a lot of drinking-and-driving problems, so maybe it will help with that, too,” said Mo Cohen, a PSU student.
“It’s a smart move to tax something they know people use a lot,” said Amanda Russel, who also attends Portland State.
“I don’t have anything against it,” said Alex D’Aurora, a political science major. “But it might be a way of putting public money into a private interest. You have to read the fine print, see where the money is going. But I don’t think 60 cents a six-pack is going to stop anyone.”
To help prep for the bill, the state Legislature met for an informational meeting in Salem last Monday to present the needs and effectiveness of drug and alcohol prevention and treatment programs.
