Proposed Tax Would Cost 100 Hospitality Sector Jobs

Montpelier, VT – The Vermont State Legislature is considering a bill to increase the excise tax on alcohol by 40% — a move that will punish small businesses and hurt Vermont’s hospitality industry by destroying approximately 100 hospitality sector jobs, according to the Distilled Spirits Council of the United States.

Under a Senate amendment to House Bill 442, the spirits tax would increase from 25% to 35% — constituting a 40% increase in the tax rate.

“In the depths of one of the worst recessions in history, I can’t think of a worse time for Vermont politicians to punish the hospitality industry with higher alcohol taxes,” said Council Vice President David Wojnar, who noted that more than 60% of the price of a typical bottle of spirits purchased in Vermont already goes toward taxes.

“Policymakers need to understand that a tax on alcohol is a tax on the entire hospitality industry – negatively impacting restaurants, hotels, bars, nightclubs and liquor stores, and the thousands of men and women they employ.  When the state hospitality industry is already struggling, this is the wrong time, the wrong tax and the wrong people to punish with increased alcohol taxes,” he added.

Wojnar pointed to an economic analysis which showed that the new excise tax rates would put Vermont’s own stake in the spirits business at a competitive disadvantage vis-à-vis competing beverages and neighboring states.  The analysis shows that the proposed tax rate will increase prices by 10% in Vermont and cost 100 hospitality sector jobs in the process.

“The hospitality industry is an essential piece of Vermont’s economy,” Wojnar said.  “Legislators should be working to protect Vermont jobs, not forcing people out of work with misguided tax hikes.”