Vote ‘no’ on taxing the working man

Politicians looking for more money to spend have teamed up with anti-alcohol zealots to take about $1 million from the Mat-Su Borough working man with a new alcohol tax.

If you have two $5 beers daily, the new tax will cost you $182 a year. Obviously, if you and your spouse each have two beverages the new tax will cost you $365 a year or more. Wow, that is a big tax increase!

Proponents will say just about anything to try to talk you into taxing yourselves to pay for more government. Below I will challenge some of the pro-tax assumptions.

If the tax is adopted, the money will go into the general fund for politicians to spend on any project they want. The proponents know the truth doesn’t poll well, so they tell you the money is going for education and emergency services. State law does not allow dedicated tax funds; the assembly can, and will, spend the money any way it wants. Mat-Su Borough Ordinance 13-089 states exactly that: “subject to annual assembly approval and vote on the budget.”

In 2003 when the state of Alaska increased alcohol taxes to the highest in the nation, Lisa Murkowski, the bill’s sponsor, said we can use the millions collected for alcohol rehab and detox, but she did not have the votes to make that happen. The state currently collects almost $40 million from this tax and the promises made about how the money would be used have never materialized.

The proponents appealing to the anti-alcohol sentiment say that the 5 percent tax increase will reduce consumption. The facts are clear. When the state passed a much larger tax, consumption did not decline, according to the state Department of Revenue. The concept of price elasticity, where an increase in price will reduce consumption, is real. However, history proves a 5 percent tax on the adult beverage of your choice will have no impact on overall consumption.

The proponents try to tug on your heartstrings by saying the tax increase will lower youth consumption. No one wants underage people to drink, especially alcohol retailers. That is why Alaska retailers were found to be the best in the nation at refusing alcohol to minors, a fact we are very proud of. Many studies show that the No. 1 source of alcohol for young people is their parents’ liquor cabinets. Very few minors ever pay for alcohol. As a result, a 5 percent tax will not impact their consumption.

We know that drugs are expensive, but it is clear some young people use drugs. Even for the few who buy beverages from an older brother or friend, it is nonsensical to think that 25 cents on a $5 six-pack of beer would make young people stop. We do have challenges with underage drinking and drug use, but we should look for real solutions, not illusions.

The hospitality industry believes the proposed alcohol tax in the Mat-Su Borough will just tax the working man and give more money to politicians. We know that we pay our share. Not only do we pay almost $40 million in taxes to the state of Alaska and some of the highest alcohol taxes in the nation, but the fees licensees pay to the Alcoholic Beverage Control Board are all returned to your community’s public safety budget.

Licensees are small businesspersons who will be harmed by this tax. Many Mat-Su residents commute to Anchorage frequently, some daily.

This tax would encourage people to stop at the store in Anchorage to buy their beverages, which will cost Mat-Su businesses and result in job reductions.

Government at all levels extract plenty from the industry. Not many people know that more than 50 percent of the price of your favorite adult beverage goes to government at the state or national level.

Government makes more money on alcohol than the suppliers, distributors and retailers combined.

Alaska retailers and the working man who pays the tax want to ask when is enough, enough?

Dale Fox is the president of Alaska CHARR, representing the interests of hotels, restaurants, bars and package stores statewide.