Oregon Beer Tax Would Increase Tax on Beer by 1,900%

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Oregon’s government is thinking about increasing the state beer tax. Taxing cigarettes is one thing, but is a beer tax taking it too far? The Oregonian reports:

The Oregon state tax on beer is less than a penny a glass. It’s among the lowest in the country, untouched in more than three decades and guarded by powerful interest groups. Never before, it seems, has the climate been so ripe to raise taxes on sin. Democrats command supermajorities in both chambers, which means they can increase taxes without Republican votes.

Two-term Rep. Ben Cannon, D-Portland, is the chief sponsor in the House of a bill that would raise the tax on a 12-ounce beer to 15 cents for drug and alcohol abuse prevention and treatment.

Oregon’s market-small but vocal craft beer makers oppose the bill, arguing that increasing the $2.60 tax on a barrel of beer to nearly $50 would crimp the industry and result in layoffs. Kurt Widmer, one of the brothers behind Widmer Brothers Brewing, says the actual tax paid by drinkers will be much higher than legislators claim, after middlemen slice their share.

“The lie of the 15 cents is that a pint (actually) goes from $4 to $5.50,” he says.

Kulongoski wants to raise the tax on a pack of cigarettes from $1.18 to $1.78, netting about $112 million every two years, most of it for the Oregon Health Plan.

Scott Jantze would be thrilled if somebody – anybody – would price cigarettes so high he wouldn’t buy them. The warehouse forklift driver has smoked for most of his 46 years and he hates it.

“If they were to tax cigarettes really high, that would be the best thing for me to quit,” says Jantze, parked in front of a television at Claudia’s Sports Bar on Hawthorne, crunching on potato chips and drinking from a small pitcher of beer.

But a tax on his beloved Budweiser?

“I got to draw the line on that one.”

Oregon’s KGW News reports that if the measure passes, a pint of beer will cost $6, with a 1,900% tax increase.

If the government is willing to consider a beer tax to fund alcohol recovery programs, why doesn’t it start taxing junk food, too, in order to combat obesity? The beer tax–or a wine tax–just don’t make much sense.

  • Awww the oregon Nazi’s…. Taxing cigarettes is one thing, but is a beer tax taking it too far? I guess you don’t smoke but do drink. so that makes it ok? stupid mofo….

  • robbie

    You should check your math. Unless a pint of beer currently costs only 96ยข where you live. The 1900% increase is the increase of the tax.

  • Drea

    Robbie, You’re absolutely right. If a pint beer cost 96 cents in Oregon now, I would probably move there. Fixed.

  • Ted Kulungoski

    Wow…..I love Oregon so much, it’s a FRIENDLY state to small businesses, tax-loving people, fish…. Oh yeah, it’s NOT. They haven’t mentioned the “mileage tax” they want to unveil and the “plastic shopping bag” tax…. the “coffee tax” ….it’s all coming folks, do some reading on Germany from 1929-1945, see why they were so mad and ready for a change.

  • stephen young

    In fact there are 1984 ounces of beer in a keg; if the tax went from $2.50 to $50 per keg, it’s price would be raised
    by 2.4cents per ounce… Now, assuming a draft beer is 12
    ounces, the increased cost is less than 29cents. A
    pint, if that’s what you get (16 ounces), would require a 38cent increase… Also, are we talking “keg” or “barrel” here? The industry prices by the barrel, not the keg (and a keg is 1/2 a barrel), so if this $50 tax is on a barrel, then my numbers above are too high by double… Anything else being reported is bull, no matter whose doing the reporting (or just incredibly “math” challanged…!(:>).

  • Kellan

    You have to account that the distributor has to mark up in order to make profit from manufacturer and the then the retailer has to mark the product up another 30% in order to make their profit. You could see six packs of Widmer or Deschutes rise from 8 dollars to 12 dollars. Why cant people just take responsibility for themselves making decisions?

  • Dan

    http://www.the6packeconomist.com/2009/02/19/drinking-to-forget-your-broke/
    Well once we are tax 100% we wont have to worry about a thing in the world. All will be provided for us and all will be happy.

  • Brian

    I’ve been wearing my “God Save the Beer” shirt every night that I’m out in a bar to raise awareness to this. If we don’t make a stink this just might pass in this economy.
    Where I got mine:
    http://www.cafepress.com/littlebayroot

  • Jessica

    Vote no. I hate cheap beer and want to continue to have the option of enjoying locally crafted brews. An increase in the price of all beers will cause people to choose nasty, gross cheap beers. It’ll be fatal to our lovely craft brew industry! Noooooooo :(. peace.

  • Olmatty

    Seems no one here bothered to look on state rep Cannon’s webpage to understand this better.

    There is confusion b/c the tax increase is a $46 increase on “a barrel” of beer, that’s 36 gallons, not a keg which ranges between 13.5 and 15.5 gallons of beer. The fifteen cents per twelve oz. is the real deal. Still a sizeable increase if you think about paying .90 more per six pack.

    However, nothing is easy. It seems that perhaps the wholesale distributers and retailers might use this tax increase to pad the pockets as the tax gets rolled out. Anyway, I understand the need, but
    I’d want something lower, but I do understand the reasoning. Right now Oregon beer tax is lees than .01 per glass. Among the lowest in the nation. Something higher would be acceptable if it’s not 1900% increase.

    Here’s Ben Cannon’s webpage. Read, learn, complain. PS. Portlanders in his district will have the real sway.

    http://www.repbencannon.com/beer_tax_proposal

    Cheers

  • Edge

    You can slice it, dice it, cut it, chop it, and spin it, but the net result is Ted Taxandgougeme is in full speed ahead mode to drive ALL business out of Oregon through excessive taxes. Is anyone aware of what we are doing with the kids of today? Do you have any idea of how destructive it is to show the kids that there is no hope for jobs in Oregon? Is this how we grow our best and brightest? By driving them into the arms of Washington? Do we show them that the way to success is to grab the gold ring of the government pension? Who pays the pensions if no one has any jobs? Business owners all know if the state they are in is supportive or adversarial. Once they know, and their obligations to leases are concluded, you better believe they are looking elsewhere. Apparently Evil Ted the Tax King won’t be happy until he assures Oregon is 50th out of 50 states in business grow…………………..oops, too late.
    Too bad Barney Frank isn’t his boss. The Banking Queen and the Puppet-In-Chief would fire him through their socialist CEO performance metrics. But if you are a tax and spend liberal, no worries. You can be as incompetent as Frank and still survive. Instead of a tea party on the 15th, how about an Impeach Ted day instead?

  • Big Dumb Ape

    Gee, here’s a truly wild and outlandish idea for Oregon (and ALL states for that matter): how about you realize we’re in a serious recession, tons of people are out of work or on the cusp of losing their jobs, money is tight for all households, so you should actually DO your freakin’ jobs and actually BALANCE YOUR BUDGETS.

    STOP raising taxes and stupid fees to justify all the ridiculous pork you push lame brains push through. I would have no problem with certain taxes or fees being hiked, but only AFTER I saw for once…JUST ONCE…state governments actually reevaluating and CUTTING wasteful programs and working hard at trimming fat FIRST.

    But do they? No. Once again, the first reaction of any dope in government remains: “Hey, we’re short on cash. So let’s just tax the people more.”

  • Edge

    Big Dumb Ape? Not by your comments. You are RIGHT ON the money (bad pun). The dopes in State Government and their King Sock Puppet as POTUS apparently only know have one answer to any economic challenge which is to increase government spending. We were once a progressive and forward looking state that businesses wanted to settle into. As a result of the exceedingly unfriendly attitude toward business we are now in a record 12.1 unemployment rate. If we simply could give up the stubborn and illogical opposition to elimination of the income tax for the adoption of a Sales Tax, Oregon could possibly end up less of a national joke and a perfect example of Tax Hell, and more of a beautiful state with a pro-business attitude and the ability to change with the times to adapt to challenging circumstances. Unfortunately the Governor of Oregon is woefully ill-equipped to undertake such an opportunity to reverse course from the disastrous road that the tax and spend liberals have put us on, and to recognize that there is nothing but a dead end ahead in excessive and unfair taxation.

  • Peter

    In Vermont we pay a 10% tax on beer and in local bars a draft is $$3.50-$4, tax included. So I am currently paying 35-40 cents tax per pint of beer. That is just a bit more than the penny people in Oregon are paying and more than double what the new tax will be. Can someone explain how we can pay much more on tax on beer in VT but still pay much less than the $5.50 that the new OR tax will cause?

  • Juneau

    I notice it doesn’t affect the wine or liquor drinkers….
    par for the course.

    Let’s tax Soft drinks and toilet paper. EVERYONE PAYS.
    I hope all of the smokers realize that the Fed tax recently imposed was for health care for the illegal children.

    It’s amazing where the tax money goes. Why don’t we up the fees in our State Parks for out of Staters? Oregon tax payers don’t get a break there either. Sad to see Oregon following right along with Washington and California.

  • Daren Hawkins

    As an Oregon resident and a Captain serving our country here in Iraq, I can’t believe what I’m hearing over here about the proposed beer tax increase! I can’t drink beer over here but have been looking forward (with great anticipation) to drinking my favorite micro-brews upon my return. After all, I live in the micro-brew capital of the world, (Portland). But after seeing this proposed increase today, I’m thinking of staying off beer permanently, (at least in Oregon). So yes, this proposed tax will definitely hurt small businesses as more and more former beer drinking patrons (such as myself) stop drinking beer.

  • Phil

    Oregon want’s to tax us till we are all on wellfair.like the lottery was going to help the School’s NOT.The(dem)need to learn how to buget what they have!STOP TAXING THE PEOPLE.

  • Rob

    This tax is also not a sales tax. It is an exise tax for oregon made malt beverages. This tax targets oregon breweries specifically. Its grand idea is to tax malt beverages to help fund alcohol addiction and abuse programs. At least thats what they want you to believe. If the oregon government actually cared about funding alcohol programs why would they tax just one small market of the alcohol sector. Why aren’t oregon distillaries, vinters, and imported forms of alcohol being taxed. This is solely about making money for the Oregon government at the expense of a apparently “undertaxed” industry. Let me say this according to any government everything is “undertaxed” and according to every industry we are “overtaxed.”

  • Katie

    I work for a large craft brewery in Oregon. This beer tax threatens my job among hundreds of other jobs. The Government is playing roulette with the lives of many citizens. I believe in taxes, I don’t mind paying them. But to okay a tax that is going to take hundreds of jobs is careless. I think the government should take a long hard look into the budget that they currently have and try to make things work. Much like many American citizens do on a daily basis. Tighten your belt, pinch pennies, and make it work. It’s not right to tax one industry to the fullest amount. I have heard a senator say it before, “you don’t have to pass an IQ test to make it into office.” But maybe that is something we should require because if they can’t see the ripple effect that will come, then I’m not sure a government position is the best position for them.

  • Bryan

    They say “It’s time Oregon breweries pay their fair share.” They mean it’s time Oregon Breweries go out of business. The fact we have the strong industry at all is partly due to the low tax. Take ECON 101 and you will realize this is a poor decision for all of Oregon. This isn’t about fairness, it’s about morons who can’t put two and two together.

    You have to wonder who is supporting this tax increase. Anheuser Busch perhaps?