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Alcohol Industry Goes on Offensive Against Tax Hike

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MANKATO, Minn. -

Beer distributors throughout the state have started a radio campaign to warn their customers about what will happen if the proposed increase on liquor taxes goes into effect.
When it comes to their message, opponents to the increased alcohol tax are getting you when you come in, at the register, and on your way out.

John Kocina, Vice President of Tow Distributing, says, "The governor originally promised when he was elected that he wouldn't tax the middle class, hard-working Minnesotan, and what we're seeing is the tax is very regressive, it falls hardest on that person. We want to make sure that people have the opportunity to contact their legislators, the governor and tell them how it's going to effect their life."

There's been some debate about the figures being used by the two sides, with supporters saying the beverage industry is overstating the cost. The difference appears to derive from the form the tax takes, in this case an excise tax. The tax will already be built into the cost, and then that increase will also be subject to sales taxes at the register.

Kocina says, "$4.60 a barrel to $27.75 a barrel. It's a big increase. And then what happens is they're going to tax that tax again at the cash register. When they say it's only seven cents, that's really not true."

And the opposition is saying the impact will be felt by more than just breweries and beer drinkers alone.

Kocina says, "We're a small business. We got 40 employees. If I lose 10% of my business, I'm going to have to lay four people off. You look at MGM as a big retailer, or Hy-Vee or one of our other stores, they lose 10%, they'll have to lay people off. And when I lay people off, I buy less fuel, I buy less tires, the truck shop doesn't get the work they had before - so it's a compounding effect."