Thursday, October 31, 2013
Did those who now own liquor stores in Washington state vote in favor of Initiative 1183, which took control of liquor sales away from the state and allowed private enterprise to peddle booze?
It’s a safe bet they did.
Yet, some owners of small stores are now looking to the state Legislature to alter the voter-approved law to give them some tax relief so they can compete with the high-volume, big box retailers.
It was understood, or at least it should have been, that big box retailers were where expected to dominate this market. It was well publicized that Costco pumped a record $22 million into the campaign for I-1183. It wasn’t an act of charity, it was strictly business.
The measure was pushed by retailers, large and small, as a way to offer better selection, convenience and prices to consumers by creating a private market for liquor.
That’s happened in some locations with volume sales.
But it’s not going well for others. The Spokane Spokesman Review newspaper reported this week 22 liquor stores across the state are in danger of losing their licenses for falling behind paying taxes and fees.
Owners of the stores say they have difficulty competing with bigger stores that are better able to spread the taxes and fees among other items, according to The Spokesman-Review.
For example, the owners of Colville Liquor & Wine and Deer Park Liquor & Wine say they’re behind in payments for the 17 percent licensing fee on all liquor sales. That fee is on top of the 10 percent excise tax added to those sales.
One store is $24,000 behind in paying the taxes and fees, the other opted not to disclose its debt. Both businesses, as well as the 20 others (mostly in Western Washington), face a Dec. 31 deadline to pay the delinquent taxes and fees or potentially lose their license to sell alcohol.
That’s unfortunate. But taking a risk (failing) is simply a reality of owning a private business with the intent of being rewarded (profit).
The struggling retailers will be looking for state help next month. The House Government Accountability and Oversight Committee has a hearing Nov. 22 on I-1182’s impacts to small retailers.
Retailers want the Legislature to reduce or eliminate the 17 percent retail fee, according to The Spokesman-Review, and they want to keep distributors from charging different prices to retailers based on the amount of alcohol ordered.
Neither of those moves sound prudent for the public.
The 17 percent retail fee was put in place to ensure state revenue from liquor would not be reduced. Nixing volume discounts might help keep the small stores stay in business a little longer, but it will drive up the price of booze for all consumers.
It’s sad some liquor retailers won’t survive the year, but that’s the harsh reality of turning liquor sales over to private businesses.