Mike's Hard Lemonade and Smirnoff Ice.

California has voted in favor of raising the tax on flavored malt beverages (FMB) such as Mike's Hard Lemonade and Smirnoff Ice, by classifying them as distilled spirits rather than under their current classification of beer, which is taxed at a lower rate. The board of equalization approved the increase by 3-2 in favor at a hearing on August 14. The tax increase from $0.20 per gallon to $3.30 will result in a $0.25-0.50 price rise per bottle, or around $2 for a six-pack, and is scheduled to take effect in July 2008, if the necessary regulations are in place by then. "Flavored malt beverages should be taxed as distilled spirits because they fall under the category of distilled spirits, as written in California law," said State Controller John Chiang. "While today's vote is about fair taxation taxing flavored malt beverages as liquor will also help reduce their popularity with young people by simply pricing the product out of their reach." FMBs are made with distilled spirits such as vodka or bourbon but are brewed like beer with fruit flavoring and coloring added.