To the Editor:
Gov. David Paterson’s budget proposal to more than double the state’s beer excise tax from 11 cents to 24 cents in hopes of generating revenue for the state will ultimately have the opposite effect. The excise tax increase will raise the cost of beer and decrease the volume sold, thus negatively impacting sales and eliminating jobs.
When the federal excise tax was doubled in 1991, three breweries closed, one in Fulton, N.Y., and across the nation 60,000 jobs were lost. Should the state excise tax more than double, the future of the Anheuser Busch brewery in Baldwinsville, N.Y., is questionable, putting more than 800 jobs at risk.
It is not sound public policy during a recession to implement taxes that would eliminate jobs and seize small business growth, the very businesses that have created about 70 percent of new jobs nationally. Members of this association are all third or fourth generation family owned, small businesses that invest in local communities and provide solid wage earning jobs and paid benefits to employees. Implementation of this tax will jeopardize the wholesaler’s ability to continue to provide such benefits.
Beer already pays its fair share of taxes. On average, 40 percent of the cost of each beer is made up of taxes.
There is no arguing that the state needs to balance the budget and seek revenue to do so, but assaulting the middle market with hidden taxes and burdening industry will only compound the debt issue.
Steven W. Harris
President, New York State Beer Wholesalers Association
Letters have been edited for clarity, style and brevity.
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