Published: Tuesday, April 6, 2010
Senate floats beer tax
An increase on suds is one suggestion to help balance the state’s budget, but the sales tax is still a sticking point.
OLYMPIA — Beer, water and candy may be the elixir lawmakers are willing to swallow to help balance the budget.
But a sales tax hike is still poisoning an agreement between majority Democrats in the House and Senate that would end the 23-day-old special session.
Senate Democrats made a new offer Monday to break the stalemate with the House on how to raise $800 million in taxes in the next 15 months to cover part of a $2.8 billion budget deficit.
House Democrats didn’t immediately respond, though they may sometime today.
Democratic leaders are trying to reach a deal and begin debating a tax package and budget as early as Friday. The special session is set to end at midnight April 13.
There is general accord between the chambers on all but $200 million of the tax package and Monday the Senate tried a new combination of ingredients to reach the sum.
Boosting the tax on mass-marketed beers would add about a quarter to the price of a six-pack of 12-ouncers and net about $58 million for the state. Microbrews would be exempt.
Democratic senators also got behind charging sales tax on bottled water, candy and gum, an idea first put forth weeks ago by Gov. Chris Gregoire. And they included a 1/10-cent sales tax hike, which is half of what they have been pushing of late and still too much for House Democrats and the governor.
Senate Majority Leader Lisa Brown, D-Spokane, said they’ve yet to find a package without a sales tax that yields enough votes for passage.
“We’ve been working on the principles of trying to be broader and also trying to provide relief for the smallest businesses and the more moderate incomes,” she said of the proposal.
Tapping the pockets of beer drinkers is a new source of revenue.
The state has been taxing barrels of brew since 1934 and Senate Democrats want to hike the portion paid by large-scale brewers defined as companies producing more than 60,000 barrels a year.
The Senate is suggesting the rate would rise by 50 cents a gallon or $15.50 per 31-gallon barrel. Mass marketers who now pay $8.08 per barrel would see the cost rise to $23.58 a barrel. (Microbrewers pay $3.30 a barrel and that would not change.)
For beer drinkers, the tax on a six-pack of 12-ounce cans or bottles would climb from 15 cents to 43 cents. The increase would go away after three years.
When asked, Gregoire said Monday she could support the beer tax.
“It’s discretionary spending. As far as I’m concerned, I’m open to it,” Gregoire said Monday.
Several senators who serve Snohomish County said they back the latest offer, with the beer tax hike.
“I talked to some beer people and there is some concern. There’s been no increase on beer in a few years and we are exempting microbrewers,” said state Sen. Mary Margaret Haugen, D-Camano Island.
Senators said they are running out of options. And if the House turns this one down it needs to make a counteroffer that drops elements the lower chamber backs and the Senate opposes. These include ending tax breaks for out-of-state residents, buyers of custom software and banks — all items the House approved earlier in the special session.
“I don’t see the Senate moving much further. We’re getting pretty thin on what we have to offer,” Haugen said. “I don’t see us putting anything else on the table.”
Sen. Jean Berkey, D-Everett, said, “It seems to me we’ve given the House two proposals and I can’t see they’ve given us anything.”
There is some division among senators on whether to make up the difference by cutting deeper into spending.
But there is unity on one point.
“I think we’re united on the fact that people want out of here,” Haugen said.
Jerry Cornfield: 360-352-8623; jcornfield@heraldnet.com.
But a sales tax hike is still poisoning an agreement between majority Democrats in the House and Senate that would end the 23-day-old special session.
Senate Democrats made a new offer Monday to break the stalemate with the House on how to raise $800 million in taxes in the next 15 months to cover part of a $2.8 billion budget deficit.
House Democrats didn’t immediately respond, though they may sometime today.
Democratic leaders are trying to reach a deal and begin debating a tax package and budget as early as Friday. The special session is set to end at midnight April 13.
There is general accord between the chambers on all but $200 million of the tax package and Monday the Senate tried a new combination of ingredients to reach the sum.
Boosting the tax on mass-marketed beers would add about a quarter to the price of a six-pack of 12-ouncers and net about $58 million for the state. Microbrews would be exempt.
Democratic senators also got behind charging sales tax on bottled water, candy and gum, an idea first put forth weeks ago by Gov. Chris Gregoire. And they included a 1/10-cent sales tax hike, which is half of what they have been pushing of late and still too much for House Democrats and the governor.
Senate Majority Leader Lisa Brown, D-Spokane, said they’ve yet to find a package without a sales tax that yields enough votes for passage.
“We’ve been working on the principles of trying to be broader and also trying to provide relief for the smallest businesses and the more moderate incomes,” she said of the proposal.
Tapping the pockets of beer drinkers is a new source of revenue.
The state has been taxing barrels of brew since 1934 and Senate Democrats want to hike the portion paid by large-scale brewers defined as companies producing more than 60,000 barrels a year.
The Senate is suggesting the rate would rise by 50 cents a gallon or $15.50 per 31-gallon barrel. Mass marketers who now pay $8.08 per barrel would see the cost rise to $23.58 a barrel. (Microbrewers pay $3.30 a barrel and that would not change.)
For beer drinkers, the tax on a six-pack of 12-ounce cans or bottles would climb from 15 cents to 43 cents. The increase would go away after three years.
When asked, Gregoire said Monday she could support the beer tax.
“It’s discretionary spending. As far as I’m concerned, I’m open to it,” Gregoire said Monday.
Several senators who serve Snohomish County said they back the latest offer, with the beer tax hike.
“I talked to some beer people and there is some concern. There’s been no increase on beer in a few years and we are exempting microbrewers,” said state Sen. Mary Margaret Haugen, D-Camano Island.
Senators said they are running out of options. And if the House turns this one down it needs to make a counteroffer that drops elements the lower chamber backs and the Senate opposes. These include ending tax breaks for out-of-state residents, buyers of custom software and banks — all items the House approved earlier in the special session.
“I don’t see the Senate moving much further. We’re getting pretty thin on what we have to offer,” Haugen said. “I don’t see us putting anything else on the table.”
Sen. Jean Berkey, D-Everett, said, “It seems to me we’ve given the House two proposals and I can’t see they’ve given us anything.”
There is some division among senators on whether to make up the difference by cutting deeper into spending.
But there is unity on one point.
“I think we’re united on the fact that people want out of here,” Haugen said.
Jerry Cornfield: 360-352-8623; jcornfield@heraldnet.com.
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