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DISCUS: Wisconsin's Liquor Tax Hike Will Destroy More than 1,000 Hospitality Jobs

October 9, 2009


MADISON, WI – The massive 58 percent liquor tax hike being proposed by the Wisconsin State Legislature will devastate the state’s struggling hospitality industry, eliminating more than 1,250 jobs on top of 4,200 hospitality jobs already lost in Wisconsin over the last year, according to an economic analysis by the Distilled Spirits Council. 
 
The tax proposal, sponsored by State Senator Jim Sullivan, would increase the liquor – though not beer or wine – excise tax by 58% from around $.86/liter to $1.36/liter making the total tax levied on spirits products in Wisconsin approximately 50% of the purchase price of an average bottle of liquor. 
 
An economic analysis by Council Chief Economist David Ozgo showed that increasingthe liquor excise tax by 58% will cause retailers to lose an estimated $84 million in retail sales and cause a loss of 1,250 jobs across the state, mostly within the hospitality sector.  According to Ozgo, more than 4,200 hospitality jobs have already been lost in Wisconsin over the last year due to the recession.  “This is no time to impose new taxes,” Ozgo noted in the report. 

Addressing the tax proposal, which is aimed at reducing drunk driving, Ozgo said: “We support the Legislature’s proposal to reduce drunk driving, but the bill unfairly targets Wisconsin’s 2.3 million responsible drinkers.  The ones who should pay for these programs are the ones who are breaking the law by driving intoxicated.”
 
Wisconsin’s Growing Microdistillers Blast Tax Increase
 
The state’s growing microdistilling industry expressed grave concerns over the impact the proposed massive spirits tax hike would have on their business:
 
“Now is the worst time for politicians to punish the state’s growing microdistilling industry with increased taxes on liquor,” said Guy Rehorst, Founder of Great Lakes Distillery in Milwaukee, noting that his three-year old distillery is already challenged by today’s economic environment.  “Increased liquor taxes will make running my small business difficult even in good economic times – but especially devastating right now.  It’s wrong for legislators to target small business owners like me who have invested so much already in the state of Wisconsin.”


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