Alcoholic beverages

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Elizabeth BeShears is the owner of BeShears Solutions LLC. She is a freelance writer and communications professional based in Birmingham.

In a deal cut under the Bentley administration, alcohol taxes could be going up again, and the Republican supermajority in the State Legislature won't even have to vote on it for it to happen.

Under Alabama law tax increases are supposed to go through the State Legislature, but in some cases that authority has been ceded to agencies.

Most agencies are limited on the fees they can charge and must appeal to the legislature if their needs outweigh the amount of revenue coming in, but such is not the case for the Alcoholic Beverage Control Board (ABC).

The ABC is considering a rule to increase the markup on liquor by an additional 5 percent. If you don't think that sounds too bad, here's the rest of the story.

Currently, all legal liquor in Alabama is priced by its manufacturer and sold to the ABC, and then the ABC places a markup on it. That markup is currently 30 percent, and is supposed to help the ABC with its overhead, as well as the funding of some other Alabama projects and agencies. Next state "sin taxes" of 56 percent --some of the highest in the nation-- are added on top of the marked up price! If you purchase it at an ABC store, there is an additional 6% state sales tax.

So, we already tax alcohol quite a bit. In fact, more than half of what Alabamians pay for liquor is either markup or taxes.

I guarantee your uncle Ed who makes a run to Florida every few months to stock up on rum has done the math.

A simple three page bill stopping the tax increase was sponsored by Madison Republican Bill Holtzclaw. The bill would have frozen the markup at the level it was on March 1st, 2017, and stopped the ABC from increasing it ever again without legislative approval.

During a Fiscal Responsibility and Economic Development committee meeting in which only half of the committee actually showed up last week Holtzclaw's bill died 4-4, with one member abstaining.

In effect, by refusing to act, this gives an agency the authority to vote to increase its own budget. What agency would ever say they don't want more money?

And if you're thinking some of the conservative firebrands in the Alabama House of Representatives will put a stop to it, I have some disappointing news for you: the House has already approved the backdoor tax increase by passing a $6 million bump to the ABC's budget conditional on the agency raising the markup.

It is true that the District Attorneys Association and the Unified Judicial System have seen the inflows from their earmarked revenue streams decrease over the last several years, but that doesn't mean they need to raise taxes; it just makes them the latest victim of Alabama's neglect of budget reform.

Our split budget system, in which most growth taxes--or revenue streams that increase with the economy--are earmarked for the education budget, which incidentally has had several record high years in a row. Meanwhile, the general fund budget languishes with taxes and fees that tend to stay the same, and even decrease due to inflation.

One of the favorite lines of Republicans in the state legislature is that we don't have a revenue problem, we have a budget problem. Yet, far too few of them seem able to muster up the political will to take a hard look at our fiscal priorities and actually do something about it.

As a result Medicaid, the Department of Human Resources, the judicial system, the District Attorneys, and a myriad of other state functions will remain underfunded.

Yes, something should be done to make the District Attorneys and the Unified Judicial System whole again, but sneaking through a backdoor tax increase isn't how it should happen.

There are still a few ways for the increase to be stopped:

The legislature can fail to pass the budget with the increased earmark or an amendment to the budget can be passed removing the earmark.

Public comment on the rule could cause the ABC Board to change its mind.

The Legislative Council, which has the ability to overturn all regulatory rules, could nix it.

Governor Ivey could veto the budget and call for the provision to be removed.

All of these options, however, would require the public to be aware of what's happening, and thus far this backdoor tax increase has garnered very little awareness.

We already have some of the highest alcohol taxes in the country and a legislature that is unwilling to take a serious look at budget reform. Why give them free rein at passing the buck yet again?