CHEYENNE — Members of the Wyoming Legislature’s Revenue Committee expect a full house when they discuss a proposed increase in the state tax on beer Friday in Buffalo.

The state hasn’t increased the tax since it was levied at two cents a gallon in 1935. It’s currently the lowest beer tax in the nation.

Lawmakers will decide whether the tax should be increased to raise money for substance abuse treatment, as proposed by Sen. Ray Peterson, R-Cowley, chairman of the Senate Revenue Committee.

Beer tax collections have been flat in recent years, averaging about $265,000 per year.

Rep. Mike Madden, R-Buffalo, the chairman of the House Revenue Committee, is interested to hear a report Friday on how much it costs the state to collect the tax.

Collection costs may be so high, he said, that the revenue doesn’t warrant the price of collecting it.

“In my opinion, you can either raise it or get rid of it,” said Madden, an economist.

One extreme option would be to increase the tax to its real current value compared to living costs in 1935, when a loaf of bread cost a nickel. If that approach were taken, the tax would be increased to 33 cents per gallon.

“I know we’re not going to be doing that,” Madden said. “Nobody has the nerve to do that.”

The current tax amounts to .18 cents on a 12-ounce bottle of beer with a mythical price of $3. Even if the Legislature quadruples the tax on that bottle of beer, it would total 0.72 cents — less than a penny.

Madden said the committee may decide to leave the tax at two cents per gallon.

The main argument against a tax boost is that beer is the working man’s drink, and a hike would mean little revenue to the state but would create considerable ill will among beer drinkers.

Pat Higgins is the owner of Orrison Distribution Co. in Cheyenne, one of 15 beer wholesalers in the state. He is scheduled to testify against an increase in the beer tax on Friday at the Hampton Inn in Buffalo.

Higgins said surrounding states haven’t raised their tax on beer in recent years.

“The reality is that if the tax goes up, the price just gets raised and Joe Sixpack pays the price,” Higgins said.

He said that in general, Wyoming retail beer prices are fairly competitive with surrounding states that have a higher tax. Colorado’s beer tax is eight cents per gallon, for example, and was last raised in 1986.

Higgins said beer is cheaper in Scottsbluff, Neb., where stores such as Walmart, Safeway and Albertson’s all have liquor licenses.

Higgins services Torrington, which doesn’t have a major-chain grocery store.

Residents from Torrington, Lusk and Guernsey go to Scottsbluff to buy everything from clothes to cars to beer, he said.

“We’re fairly competitive, given the drawback of a small-population state,” Higgins said. “If you’re a retailer operating in Lusk, there are only so many people in Lusk.”

Higgins said Wyoming retailers are under pressure to be price-competitive with new products, including craft beers and flavored vodkas.

Legislative leaders who sit on the Management Council, the Legislature’s administrative arm, added a study of taxes on liquor and wine to the Revenue Committee’s interim duties.

Madden said the committee will be asked to delay discussion of an alcohol tax until its October meeting.

Wyoming is a liquor-control state that acts as wholesaler of distilled spirits and wine through the liquor warehouse in Cheyenne. The revenue for the state is generated by the markup in the price to the retailers who buy the products.

Contact capital bureau reporter Joan Barron at 307-632-1244 or joan.barron@trib.com

(10) comments

thehousemouse
thehousemouse

Its called a sin tax guys, leave our beer alone, your gouging us on gas, smokes, hunting fishing, camping, and now your after our beer too. what is it with you guys tax this tax that. why dont you find something to do with your time besides figure out how to over regulate and over tax wyoming people.

side oiler
side oiler

Have you ever seen a tax a phony RINO did not like? And they moan about tax and spend Liberals.

Mo
Mo

Oiler. You really need to get a new line.

side oiler
side oiler

Ohhh...gee...I guess you can always read other papers,eh? Need a hanky?

ralph
ralph

I'm more than willing to pay less than half a penny more for beer. At the increased rate they are talking about if I drank two beers every day of the year the tax would only cost me $3.65 for the whole year! I sometimes pay more than that for one beer at a bar. That insignificant tax won't stop me from buying my beer and the idea that the money might go to help people who have a problem with alcohol might even help me to enjoy my beer a little more.

pappy
pappy

HIggins evidently isn't buying in to the Madden theory on taxes. Madden is the economist who said the gas tax would, at least in part, be paid by the dealers and not the consumer. Well gas prices jumped 10 cents, where I live July 1, and haven't went down. So the consumer is paying the full 10 cents. Gas in Denver and Billings which have higher taxes is cheaper. Maybe a better study would be why the Govt. has to provide a substance abuse program and does it do anything?

Cody Coyote
Cody Coyote

A moment of hilarity here, to wit:
" The main argument against a tax boost is that beer is the working man’s drink, and a hike would mean little revenue to the state but would create considerable ill will among beer drinkers. "

Ill will ? We definitely do NOT want to create any more ill will among Wyoming drinkers. Them boys ( and almost as many girls ) get really really mean after they've been drinking a while. We've got enough ill will around here on a hot dry day at noon.

We dare not ill their will by raising the tax on that bottle of Bud from 0.18 cents to an unheard of 0.72 cents...that's robbery ! An illegal taking ! Government jackbooted thuggery ! An infringement of my 32nd Amendment Right to keep and bear brews.

Seriously now, it will not be the consumer of malt beverages whose will will be illed here. It will be the Beer Wholesalers lobby...the warehouse owners. It's alread happened. Raising the wholesale beer tax is not new. it's come up before. A few years back I walked into a convenience stor in Cody and there was a petition on the counter protesting the possibility of raising the 2 cent tax. The owner of that C-store also owned a liquor store. Then we had the local mogul across the river who owned the Budweiser franchise ( among others ) going on a fierce tirade against this heinous tax increase. He wailed and railed and threatened to withdraw his generous support of community events and charities and such if this tax passed. He made a LOT of noise over increasing the lowest beer tax in the nation from almost zero to just above zero...I believe they were asking to increase it all the way to a nickel a gallon...still only 0.46 cents per bottle of Budweiser. Outrageous!

Never mind that his wholesale price for bulk beer was probably the highest in the whole state ( or tied with Teton County ). He gouged his local customers. The Smoking Gun ? --- I had taken a trip to Hawaii that year. Bought a 6-pack of cold canned Budweiser in a C-store in Honolulu for $ 1.85. The retail price in Cody for the same was nowhere less than $ 3.00 a six pack. The beer in Hawaii had to be freighted by cargo ship from the mainland, 2700 miles away. The Budweiser in Cody came from the Fort Collins Brewery by truck, 360 miles south. The wholesale beer tax in Hawaii is 45 times higher than Wyoming....90 cents per gallon vs. 2 cents. Hawaii is second highest in nation behind Alaska. Wyoming is the lowest...next lowest is 4 times higher.

The outrageous difference in price between the same brand name canned beer sold in Honolulu and Cody Wyoming was due entirely to the wholesaler gouging up the price. In other words, GREED. The tax component of the selling price was miniscule.

- just a little perspective. Raise the Wyoming beer tax to forty cents. You'll hardly notice. And no ill will intended. I have spoken.

Charles Curley
Charles Curley

Just what we need: a 300% tax increase! Not even Barack Obama has that much chutzpah!

And talk about sending a mixed message: "Drink more beer so we can fund rehab for alcoholics."

We've seen this before. http://wyliberty.org/highlight2/rivertons-beer-tax/

ralph
ralph

Read your article in the link. Do you really think people are going to drink less beer because they have to pay less than a penny more per beer and the average beer drinker pays less than $4 a YEAR because of the tax?

Flint
Flint

Great. We are going to let Rep. Mike Madden decide on another tax increase. Recall that he's the "economist" who claimed that a 10 cent fuel tax increase wouldn't break the household budget and Wyoming wouldn't see the increase because other states and the refineries would absorb the cost. And somehow he's now concerned about the cost of tax collection? What a bunch of B.S.

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