In all of the financial details and reform plans tossed around Lansing since the start of 2010, one legitimate way to quickly shrink big holes in the budget remains officially off the books.
We’re talking about the beer tax, of course. It hasn’t been touched since the 1960s and simply adjusting it for inflation over the past four-plus decades could raise a quarter of a billion dollars.
Yet, in surveying the crumbling budgets of state governments across the country, nationally syndicated columnist Neal Pierce says the red ink demands new approaches… “Tax junk food,” he wrote earlier this month. “Champion exercise and sound diets.” Can we all agree beer is a junk food? A very popular junk food?
So, why won’t any politician in the state capitol touch this issue?
“It might have something to do with the $1.5 million the Michigan Beer and Wine Wholesalers political action committee has handed out over the years to the members of the 95th Legislature and the various PACs that they control,” concluded a recent report by the watchdog Michigan Campaign Finance Network. “It might have something to do with the fact that scores of legislators’ fundraisers have been hosted by the Beer and Wine Wholesalers.”
Which political leaders are taking campaign cash from the beer lobby while ignoring a legitimate and strategic revenue source?
5 Comments
When I read about all of the plans for generating revenue additional here in Michigan (read: raising taxes), I’ve always noticed that those people want to shift the cost onto others.
Beer taxes. Sales taxes. Gas taxes.
It never ends.
But I’ve always noticed that those very same people are always loath to go to the easiest source of revenue: themselves.
Yes, you’ve read that correctly.
People who want to raise taxes are always apprehensive to set an example themselves.
Why?
People like to look to other states for new and innovative ways to raise money, sadly no one wants to adopt a program employed in eight other states here in Michigan; creation of a “Tax Me More” Fund.
Say that you don’t like the fact that Lansing doesn’t have enough money to spend. Simple, just take out your own wallet or whip out your own check book, and send your money to:
Michigan Department of Treasury
Lansing, Michigan
48922
Imagine the amount of revenue generated by the people promoting for more taxes, putting their own money where their mouths are and providing it themselves.
Time’s a wasting.
Pull out your checkbook today!
John, I believe I’ve pointed out to you previously the fact that simple inflation of price of beer has increased the amount of revenue collected by the State.
First of all, the sales tax in the 60s was 4%. Then it was raised to 6%. See what happened there?
Then consider the cost of a bottle of beer in the 60s compared to the cost of that same bottle of beer today. Is not the tax collected keeping pace with inflation?
If The Center For Michigan’s answer to the State’s woes is more taxes on consumers, I may be sending you a “Remove me from your mailing list” email.
I’d say it’s a good way to raise some revenue–not that Michigan doesn’t need serious reform in the ways its revenue is spent. Major, major reform. Rick for Michigan, anyone?
And yes, while sales tax is part of the tax on beer, the excise tax remains at 1.9 cents for 12 floz–unchanged since the 60s. No inflation adjustment there!
My guess is that like cigarettes, the demand for beer is pretty inelastic, which makes it a great place to generate revenue to fund Pure Michigan, education, etc. Maybe someone can explain to me why distributors are so against it. Is it a working capital issue? What can be done to address it?
I already pay way more taxes than I would like (and the Michigan tax code is just too screwed up with its SBT, MBT, MBT surcharge, ill-fated, last-minute tax on a few service providers, etc.) but I’d rather pay taxes directly to the state than send them on to Washington and then have to beg to get that money back…
…as long as those taxes are spent to fund things that we, as Michigan residents, largely agree upon.
Same Exact issue from the article below -
[2010 Politics likely to get in the way of good budget policy]
And Same Exact solution as i gave in that article.
Btw, I dont pretend to know all the laws involved nor all the details that would go into pushing my ideas. Its an IDea from a Michigan Citizen that has basis and I believe is a solution.
It would be up to the powers that be to hammer something like it out and put into practical use to get rid of the Lobby groups who are literally hurting our state for their own personal private power and profit agendas. period.
Just out of curiosity, why is it that most tax proposals never seem to be a short-term minimal increase with a steady long term progression to bring new revenue in but make it as painless and seamless as possible for the corporations and consumers that would be affected?
Most times, legislation comes up iwht some massive increase all of a sudden to plug a hole and everyone starts complaining at once.
many small increases on many target industries with a slight progression year over year seems like it would be most palatable, to sudden shifts in taxation.