WASHINGTON – Today the American Beverage Institute (ABI), which represents over 185 restaurants in Illinois, denounced Cook County Board President Toni Preckwinkle’s proposal to hike alcohol taxes. Under the budget proposal, the tax on beer and wine would rise by 50 percent and the tax on liquor would rise by 25 percent.
Illinois alcohol taxes are already higher than surrounding Midwestern states and increased dramatically in 2009 after Governor Pat Quinn (D) signed a capital construction bill that hiked alcohol taxes to raise roughly $114 million in annual revenue. After the 2009 tax increase, alcohol sales across the state border skyrocketed. Cook County’s proposal would push the rates even higher, encouraging residents to buy alcohol elsewhere while costing the at least county 270 jobs.
“The hospitality industry is still struggling to recover from the effects of the recent economic recession. Cook County should focus on supporting economic growth instead of further increasing taxes. Raising beverage taxes will make it harder for the hospitality industry in Cook County to remain competitive, sending many industry workers straight to the unemployment line,” said ABI Managing Director Sarah Longwell
Illinois’ unemployment rate is already higher than the national average at 10 percent. Increasing hospitality taxes will do little to help that figure.
Not only do alcohol taxes contribute to job loss, they are regressive: According to the Tax Foundation, individuals earning less than $20,000 per year face federal alcohol tax burdens that are more than 18 times higher than individuals making in excess of $200,000.
“Alcohol is already one of the highest taxed consumer products in the United States and Illinois has one of the highest tax rates in the country. 58 percent of the cost of every bottle of distilled spirits sold in Cook County already goes to taxes and fees. Too often, hospitality taxes are treated like an ATM to generate extra revenue to make up for wasteful government spending,” said Longwell. She continued, “As Americans struggle through tough economic conditions, Cook County could not pick a worse time to increase taxes.”
For more information or to speak with
ABI managing director Sarah Longwell, please contact
Anastasia Feaster at 202-463-7110.