New so-called “vice taxes” on cigarettes and alcohol have been one of the few popular taxes among Wyomingites. A poll last year found that 81 percent favored raising taxes on alcohol and 78 percent favored raising them on cigarettes.
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Now, the Legislature’s Interim Joint Revenue Committee is moving forward on both proposals. While the committee’s consideration of a $1 per pack increase on cigarettes drew more attention and discussion at its meeting in Cheyenne earlier this month, the panel also advanced proposals to raise three separate alcohol taxes:
- Raising the sales tax on malt beverages from one-half cent per 100 milliliter to four and three-fourths centers per liter;
- Raising the sales tax on wine and spirits an additional one cent per 750 milliliters, and raising the tax on malt beverages an additional one cent per 12 ounces to fund an alcohol abuse recovery fund;
- Allowing the Wyoming liquor division, which oversees wholesale distribution of alcohol to retailers, to generate a profit of 20.6 percent rather than the current 17.6 percent.
- The revenue committee will debate the bills at its December meeting, where members will decide whether or not to sponsor the measures and encourage passage by the full Legislature.
Sen. Dave Kinskey, R-Sheridan, said he requested the bill on taxing alcohol to pay for substance abuse programs in part to learn how much money could be raised.
Kinskey said he had been researching the history of Wyoming’s sales tax and learned that in the 1930s, the governor — Democrat Leslie Miller — believed that if a liquor tax was introduced, counties would have enough money to eliminate the property tax.
While taxes on alcohol are an easier political sell than raising sales or property tax — or implementing an income tax — they’re also not able to raise as much money.
Quadrupling the malt beverage tax would raise just under $2 million per year. Raising the sales tax an additional 1 cent on wine, spirits and beer would bring in roughly $1.4 million, while allowing the liquor division to increase its profit margin would lead to around $3 million per year in annual revenue.
In all, the Legislative Service Office estimates that all the alcohol taxes combined would generate about $6.4 million per year, a drop in the bucket next to the $385 million budget gap the state is facing for the upcoming fiscal year due to declines in the energy sector.
Still, the alcohol taxes may be able to sneak through a Legislature, and especially a state senate, that has been hostile to looking at new revenue before deep cuts are imposed on state spending.
“I do support raising the cigarette tax, as well as taxes on beer and alcohol,” said Revenue Committee co-chair Sen. R. Ray Peterson, R-Cowley. “All those things cost the state money.”
The measures to increase taxes specifically on alcohol are also not the only bills being considered by the committee that would affect drinkers in Wyoming. A proposed “tourism tax” — which the committee renamed as a lodging and hospitality tax — would raise the state sales tax by 1 percent on businesses that are thought to cater to out-of-state visitors, including bars.
Zannie Driskill, who operates hospitality businesses near Devils Tower, testified in favor of that tax. Driskill acknowledged that the levy would be applied to Wyoming residents who went to bars but said that they could choose not to go.
“Drinking is a luxury,” she said. “Not a right.”