Proposed liquor tax increase would help mentally ill, disabled

beerKansans would pay a few more cents for every beer or glass of wine to support programs for the disabled and mentally ill under legislation reviewed by state lawmakers Friday.

The bill would double an existing tax on wholesale alcohol which is passed along to the consumer in the price of beer, wine and liquor. It’s one of several tax hikes being considered by lawmakers looking to close a $400 million budget deficit.

The current tax rate — unchanged since 1977 — is 18 cents for every gallon of beer, 30 cents for a gallon of wine, and $2.50 for a gallon of liquor.

The estimated $21.8 million in additional revenue would be split evenly between mental health programs and services for the developmentally disabled. Lawmakers have cut funding for both since the state’s financial crisis began.

The legislation received a hearing in the House Tax Committee on Friday. There’s no word on when or if the committee might vote to send the bill to the full House.

Two Johnson County lawmakers, Rep. Kay Wolf, a Prairie Village Republican, and Rep. Pat Colloton, a Leawood Republican, came up with the idea.

“We are hurting the very people who need our help the most,” Wolf said. “No one wants to raise taxes and no one is pro-tax. But this is a true consumption tax.”

The state has cut more than $20 million in grants to community mental health centers, and reductions to programs for the disabled have put more than 4,000 Kansans on waiting lists for services.

“Investments in these programs are not just justifiable, they’re necessary,” said Tom Laing, director of InterHAB, a coalition of groups serving Kansans with disabilities. “The system is failing through lack of stewardship.”

Lobbyists for liquor distributors and bars, as well as some liquor store owners, urged lawmakers Friday to oppose the tax proposal. They predicted it would hurt sales and prompt Kansans living near the state line to shop in Missouri, where wholesale taxes on liquor already are lower.

“Our stores must compete directly with Missouri,” said Jennifer Vogel, whose family owns two liquor stores in Kansas City, Kan. “Please consider the incredible burden this would put on us.”