Container tax ending but prices to rise Liquor, beer, soft drinks will cost more

December 28, 1990|By Larry Carson | Larry Carson,Evening Sun Staff

The death of Baltimore County's much maligned beverage-container tax next week will be marked by higher -- not lower -- prices for beer, soft drinks and liquor because of industry price increases and new federal taxes.

Although the end of the container tax will knock 12 cents off the cost of a six-pack of beer or soda in Baltimore County, prices for those items are expected to increase about 25 cents per six pack for beer and perhaps a few pennies for soda, according to store owners.

On Jan. 1, the federal excise taxes will double on beer -- from 16 cents to 32 cents -- per six-pack and will triple on a 750 milliliter bottle of table wine -- from 3 cents to 21 cents. The excise tax on a fifth of 80-proof liquor will jump from $2 to $2.16.

The county beverage tax levied a tax of 2 cents per container for bottles and cans under 16 ounces and 4 cents each for those above that size.

With the end of the tax, the county will give up $3.5 million in revenue during the last half of the current fiscal year. The beverage tax will continue in Baltimore, however, at least until June 30.

Tom Berry, owner of another small Towson liquor store, said some brewers and distillers decided to impose their own price increases now, hoping that federal tax increases will get the blame.

"We're tired of them picking on our industry," Berry said of local and federal lawmakers. "I'm in favor of them taxing golf balls."

The price of some name brands will increase substantially, with a fifth of Smirnoff Vodka due to go from $7.89 to $9.19, according to Ed Tuttle, owner of Chesapeake Liquors, a small package goods store near Towson State University. A fifth of Gordon's Gin will go up 50 cents at his store, Tuttle said.

Some brands of fancy scotch are to increase by $25 to $30 a case, though the federal tax increase will account for only $2 a case, according to a supervisory employee at Churchill Distributors, one of the area's largest wholesale liquor outlets. The employee said he did not expect the end of the container tax to have much effect on competition between city and county liquor outlets.

Tuttle and Berry said their per-bottle price of 65 cents for a 16-ounce bottle of soda will not likely rise or fall.

John Gahan, a buyer for the Mars supermarket chain, said bottlers are raising the price of a case of soda 58 cents. He said his chain will add another 2 cents to cover its increased costs. So a shopper buying a six-pack of non-return soft drinks at regular price will see that price increase 15 cents, offset by the 12-cent drop-off from the end of the container tax, leaving a net increase of 3 cents per six-pack.

Because 85 percent of shoppers buy whatever soft drink is on sale during a given week, they won't see much of a difference, Gahan said.

The Mars chain has kept advertised soft-drink prices at one standard level whether the store was in Baltimore or Anne Arundel County, which did not have a container tax, Gahan said. The tax is added separately by cashiers in the Baltimore County stores, he said.

Robert Santoni, president of the Santoni supermarket chain, said his Baltimore County stores will be selling soft drinks for less than his city store, in the 3800 block of E. Lombard St. He said the container tax is a complicated burden.

Craig Button, former president of the Baltimore County Licensed Beverage Association, and one of the chief opponents of the county container tax, said his opposition to the tax was justified, even if consumers will see prices rise when the tax ends.

"You can't let people segregate one industry," he said of the county tax, adding: "The whole argument was they weren't telling the truth to people. They said the money was going to go to help get rid of trash, but it wasn't. It was going into the general fund. Gas is going up 50 cents a gallon. It costs more to deliver by truck."

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