Two lawmakers seek higher Oregon beer taxes

Modern Brewery Age, March 24, 2003

AP-Two Democratic lawmakers last week launched what they concede is an uphill fight to raise beer and wine taxes to generate money for medical, social and law enforcement programs.

However, the lawmakers and other proponents said they are prepared to take the proposed increases directly to voters if the Legislature balks at the proposal.

Sen. Bill Morrisette of Springfield and Rep. Jackie Dingfelder of Portland are sponsoring a bill they say would raise the beer tax by about 7 cents a bottle and the wine tax by about 15 cents a bottle.

They say they believe Oregonians, who handily approved a cigarette tax increase last fall, would support higher "sin taxes" on beer and wine as well to help ease the state's budget woes.

"We are in very deep trouble, and we see this as a partial solution," Morrisette said.

The two are hoping the Legislature will pass the beer and wine taxes directly, but that doesn't appear likely given the thrashing that similar proposals got during a special session a year ago.

A key factor against any such increase is the beer and wine industry, which has become a key contributor to Republican legislative campaigns.

In the 2002 election, the industry contributed more than $300,000 to legislative candidates, according Money in Politics Research Action Project, a Portland watchdog group.

Beer and wine lobbyist Paul Romain said that especially in the current weak economy, the proposed tax hikes could hurt Oregon's microbrew and wine industries and impose a financial hardship on beer and wine drinkers. "lt's not a modest increase," he said.

The measure being sponsored by Morrisette and Dingfelder would impose a $23.17 per barrel tax on beer on top of the existing $2.60 per barrel tax. The current 65-cent-a-gallon tax on wine would be raised by an additional 75 cents.

Morrisette estimates the increase would raise $120 million in the coming two years to, among other things, maintain prescription drug coverage for low-income seniors and disabled people, "We would be funding emergency programs that are not in the governor's budget," he said.

House Majority Leader Tim Knopp said House Republicans aren't eager to embrace such a hefty tax hike. "It seems quite excessive in today's struggling economy," the Bend Republican said. "I think it could potentially hurt our Oregon microbrew industry."

Dingfelder said, however, that she believes the measure would pass handily if it were placed on the statewide ballot. "I've received a huge amount of support for this proposal" from constituents, he said.