State Rep. Therese Berceau, D-Madison, proposed a raise in the beer tax last Tuesday to increase revenue contributions to alcohol-abuse programs in the state. The two-cent increase would be the first increase since the tax’s creation in 1969.
The collected revenues would go directly to programs helping individuals with alcohol-related problems.
The anticipated revenue for alcohol-abuse treatment from the two-cent increase would amount to $4.7 million annually.
“We have a lot of alcohol abuse in our system — if we don’t give [people] adequate treatment, they end up back in the system,” Berceau said.
Supporters believe that those consuming more beer should be contributing to abuse programs.
“It seems that [the tax] would bring us in line with many of the other states in the country, and there is a large cost with individuals who use and buy,” said Linda Roberts, University of Wisconsin associate professor in human development and family studies. “It would target the individuals who consume large amounts of beer.”
The university says that, of the estimated 15 percent of freshmen who drop out of college in a given year, most cases are alcohol related.
Many students, however, are opposed to the tax because it institutes an unnecessary expenditure in an already tight budget. But other students support the tax on the condition that the money goes directly to alcohol-abuse recovery programs.
“Go ahead and raise it — it’s a good idea as long as money goes directly to treatment,”
UW student Tyler Nadelhoffer said.
Wisconsin’s beer tax is the third lowest in the nation, and gasoline is taxed over four times more per gallon than beer. Neighboring states Illinois, Minnesota, Michigan and Indiana all charge two or three times more per gallon of beer, according to a release.
The beer tax, since being set at $2 a barrel the year of its inception, has lost 80 percent of its value as a result of inflation. If this were adjusted to 2003 dollars, a barrel of beer would be taxed today at more than $10.
Opponents believe that any tax increase on such a hot Wisconsin commodity is ill advised.
“Only in Madison would the nutty idea of placing an additional tax on Friday night fish fry [arise],” Rep. Scott Suder, R-Abbotsford, said. “I will personally make sure this proposal is dead on arrival.”
A 50 percent tax credit is given to the first 50,000 barrels produced by small breweries and pubs, and they would continue to pay half of any new increase, according to a release.
Other critics believe that an improving economy and increasing revenues prove tax increases are not necessary for a balanced budget, Assembly Democratic Leader Jim Kreuser, D-Kenosha, said in a release.
“Wisconsin’s economy is back on the right track,” Kreuser said. “Unemployment is down, revenues are increasing and we are no longer facing the prospect of painful cuts. Now is not the time for opening the door to tax increases, especially before joint finance has made a single change to the budget.”
Kreuser asserts that Assembly Democrats will support the budget proposed by Gov. Jim Doyle because it meets Wisconsin’s main concerns without tax increases. Doyle’s budget aims to resolve the $1.6 billion deficit in addition to funding education, completely funding shared revenue and upholding health care.