This past week, state Rep. Terese Berceau and Sen. Fred Risser announced their co-sponsorship of a bill intended to raise the tax on beer in Wisconsin to $10 a barrel. In a state that cheers for a baseball team named the ""Brewers,"" and where many people falsely believe beer is our official state drink, the mere idea of this bill may seem to go against the culture of the Badger State. But once a little analysis is done, it becomes clear that this proposal is common sense.
Math alone shows that there will be little impact on consumers. The tax rate of $10 per barrel translates to a mere 2.4 cent increase per 12 oz. bottle, a change that most beer drinkers won't even notice. As for breweries, it is hard to imagine Wisconsin's beer industry experiencing many adverse effects either. One can assume that the tax will simply be passed on to consumers through barely perceptible prices hikes.
Even if breweries eat the tax themselves, this tax hike will only bring Wisconsin on par with most other states in the nation. Currently, Wisconsin has one of the lowest tax rates in the country for beer, Wyoming having the lowest. It seems that most of the opposition to the increase comes from lobbyists working on behalf of the breweries, who take advantage of our alcohol-friendly tax policy, and politicians like Gov. Jim Doyle who oppose the tax are looking out for the interests of MillerCoors more than the interests of the state. Wisconsin has likely received some increased business from its low tax rate, but it is unlikely that a mass exodus of breweries will occur once the tax is brought to a more mid-range level.
However, that risk is offset by the massive budget deficit the state is currently facing. The extra 2.4 cents generated for every bottle sold will create $40 million annually for the state, much of which would go toward hiring direly needed new state prosecutors. Any additional money raised by the tax can be funneled into preventing drunken driving and fixing Wisconsin's culture of excessive alcohol consumption. While the alcohol tax itself may not prevent binge drinking because of its low cost, it could help fund programs that have been effective at curbing dangerous drinking behavior.
In these dire economic times, revenue streams are drying up and state lawmakers need to find new ways to keep the coffers full. While this new tax increase may not have much of a direct impact on safety, as some of its proponents claim, it certainly provides a new revenue stream to help out legislators desperately trying to sort out the government's balance sheet. As anybody who has ever run out of money knows, some sacrifices and hard choices need to be made. Paying a couple cents more for a bottle of beer is not one of those difficult decisions.
