Maryland’s Three-Tier Distribution System is Broken
Interesting chatter over the last few days about a new alcohol tax bill in Maryland. Over the past weeks I’ve outlined Maryland’s Wine Siege. Now this gem. Deceptively named the “The Lorraine Sheehan Health and Community Services Act of 2010”. The house bill is here. The senate version is here.
Synopsis:
Increasing the State tax rates for alcoholic beverages sold in Maryland from $1.50 to $10.03 per gallon for distilled spirits, from 40 cents to $2.96 per gallon for wine, and from 9 cents to $1.16 per gallon for beer; providing for the distribution of the additional revenue to special funds to be used only for the purpose of providing additional funding for specified health services; etc.
Brandon Miller-Millhouse summarized as following:
“A Maryland Brewery" Brews 40 Barrel batches
40 bbl = 1240 gallons presently taxed at $111.60
with bill passed that same single batch would be taxed $1,438…So lets say a brewery right now sells a gallon of beer for $5 (just an example) this tax makes them to have to raise the price of their product to say $7.50-$8 per gallon. The Distributor has to mark it up to retain their profit margin ($10-$11)and the retailers have to mark it up retain their profit margin ($13-$15) and WE are left paying Stone Six-Pack Prices for everything…oh and I almost forgot the 6% MD sales tax.
BTW – Brandon reads this blog, so if you’d like to leave him feedback, do it here. I won’t be handing out his email address.
Conclusion
Just another example of how clearly broken Maryland’s three-tier distribution system remains. I completely understand wanting to raise the taxes to be more in-line with other states, but don’t provide that comparison to me regarding states that don’t have a bogus three-tier distribution system in place. The reality is, the distributors don’t care because they are going to add their costs on regardless of what this bill does just as Brandon has previously outlined.
Opinions and comments welcome.
Related posts:
will you be tracking and posting which state senators and delegates vote for and against this tax bill??
Good question. I’ll have to see if I can figure out where to get that data.
At this point you can see the delegates and Senators that are ‘Sponsoring’ this Bill on the Bill Info pages above: Senators Jones, Madaleno, Exum, Forehand, Frosh, Lenett, Pinsky, and Raskin. Delegates Bronrott, Hubbard, Ali, Anderson, Barnes, Benson, Bobo, Burns, Carr, Carter, Dumais, Feldman, Frick, Frush, Gaines, Gilchrist, Gutierrez, Guzzone, Hucker, Ivey, Kramer, Kullen, Lee, Levi, Manno, McIntosh, Mizeur, Montgomery, Nathan-Pulliam, Pena-Melnyk, Ramirez, Reznik, Robinson, Rosenberg, Ross, Simmons, Stukes, Tarrant, Taylor, Valderrama, and Waldstreicher.
It is safe to say they will be voting ‘yes’ on this Bill and those are the ones you may want to contact first from you District.
When this brought up (March 10th) there will be a full disclosure of who voted what in the proceedings.