Legislators consider taxing Joe Sixpack where it hurts the most

PROVIDENCE –– Facing crushing budget deficits, reluctant state lawmakers have already agreed to raise taxes on cigarettes and health-insurance premiums in recent months. But they have largely left Joe Sixpack out of the debate.

Until now.

Substance-abuse advocates have launched an effort to revive a long-ignored proposal to boost Rhode Island’s tax on beer. And some lawmakers are listening.

“I’ve always liked the idea,” said House Finance Committee Chairman Steven M. Costantino, noting a recent move by the Massachusetts’ legislature to eliminate its sales-tax exemption on alcohol. “I would say we’re looking at all potential revenue sources.”

Even a modest hike in the beer tax could discourage destructive drinking and bring millions of new dollars to the state’s depleted coffers, according to supporters. But alcohol distributors and liquor store owners say higher beer taxes could hurt both local businesses and thirsty Rhode Islanders.

“Ultimately, it will raise the cost of beer to the consumer,” said Charles M. Borkoski, vice president of marketing for McLaughlin & Moran, Rhode Island’s dominant beer distributor. “And the economic conditions in our industry are such that any reduction in sales could result in a reduction in personnel.”

But the beer tax supporters have been pushing hard this legislative session.

The executive director of the Drug and Alcohol Treatment Association of Rhode Island, Neil A. Corkery, has met with Costantino at least twice about nearly doubling Rhode Island’s beer tax, currently at 10 cents a gallon. The price of a six-pack would jump by about a nickel. Corkery estimates the increase could generate $3 million for the state.

And the nonprofit group, Rhode Island Communities for Addiction Recovery Efforts, led a State House rally yesterday, attracting more than 100 people to highlight its top legislative priority: increasing the state’s alcohol tax. The organization also launched a direct-mail campaign in recent days aimed at elected officials, who have avoided raising the beer tax since 1989…

Current taxes on a six-pack:

Federal excise tax: 33 cents

State excise tax: 5.6 cents

Beer is also subject to the state’s 7 percent sales tax.

Sources: R.I. Division of Taxation, Center for Science in the Public Interest

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