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Alcohol tax hike gaining support

The Gazette
Friday, Sept. 3, 2010
by Jeff Newman | Staff writer

More than 140 candidates pledge to back increase

Politicians typically are loath to raise taxes in an election year, but that’s not the case when it comes to Maryland’s alcohol tax.

More than 140 candidates running for the General Assembly have signed on to a proposed dime-a-drink tax increase, with an eye toward using the money for health care for childless adults and programs for developmental disabilities, mental health and addiction treatment and prevention.

The proposal, laid out in a resolution sent last month to candidates for all 188 legislative seats, would raise the state’s alcohol tax, among the lowest in the nation.

The tax hike would bring in $214 million for the state while saving $249 million in health care costs associated with alcohol abuse, said Vinny DeMarco, president of the Maryland Citizens’ Health Initiative, which drafted the resolution. Those estimates are based off a 2009 study by two Johns Hopkins University professors, who found that “alcohol excise tax increases save lives, reduce health care costs, create and preserve jobs, and prevent alcohol-related problems.”

Among the 146 candidates to sign by the Aug. 27 deadline were 63 incumbents– 18 senators and 45 delegates. In addition, 17 candidates who did not sign the resolution supported the tax increase via a Progressive Maryland questionnaire, including Del. Sheila E. Hixson (D-Dist. 20) of Silver Spring, who chairs the House Ways and Means Committee.

But at a time when the nation’s economy still is lagging and the state is facing a budget crisis, some lawmakers remain opposed to any tax hike.

“I don’t think it’s appropriate in this economy to be increasing taxes of any kind,” said House Minority Leader Anthony J. O’Donnell (R-Dist. 29A) of Lusby. “People are out of work, small businesses are having hard time keeping their doors open, and increasing consumption taxes will tend to push people across our borders to do their commerce in other states.”

Alcohol currently is taxed by the gallon– 9 cents for beer, 40 cents for wine and $1.50 for spirits. The proposal would raise the per-gallon rates to $1.16 for beer, $2.96 for wine and $10.03 for spirits, or roughly 10 cents-per-drink for all three, DeMarco said. Rates have been stagnant for spirits since 1950, and for beer and wine since 1972.

Del. Sue Kullen (D-Dist. 27B) of Port Republic said she would not vote for an increase to the alcohol tax if revenues were earmarked for specific purposes, even if they are mental health or disabilities programs, which she supports. Kullen noted she could vote for a general increase to the alcohol tax, but not one as drastic as the dime-per-drink proposal.

Kullen, a developmental disabilities consultant and president of the Maryland Women’s Caucus, signed onto a bill similar to the proposal last session because it was a caucus initiative, but the legislation never made it out of committee.

The increases seem dramatic “because [current rates are] so low, and it hasn’t been raised in all these decades,” DeMarco said. “We have to bring our alcohol tax rates into the 21st century.”

DeMarco expects continued pushback from a “very powerful” alcohol lobby, but thinks the campaign put on by his and other health care advocacy groups, modeled after a successful push for a $1 increase to the tobacco tax in 2007, will bear fruit in the 2011 session. He cited a recent poll by OpinionWorks that shows 71 percent of registered voters support a dime-per-drink tax increase if its revenues are dedicated to health initiatives.

A number of organizations have endorsed the proposal, including the AARP, National Association for the Advancement of Colored People, the American Heart Association, the National Association of Social Workers, Mothers Against Drunk Driving and the Mental Health Association of Maryland.

“I think we are poised in 2011 to enact this life-saving measure,” DeMarco said.”We think the Maryland General Assembly will agree with the people of Maryland that it is good policy and good politics.”

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