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WI's Kasten blasts beer hike tax plan.

WI's Kasten blasts beer tax hike plan

U.S. Senator Bob Kasten (R-WI) last week blasted a plan announced recently in Washington to raise the beer tax - which would cost Wisconsin 6,000 jobs - and pledged to "fight any attempt to raise beer taxes, period."

Kasten was reacting to the Office of Management and Budget Director (OMB) Richard Darman's plans to equalize the Federal beer excise tax at 25 cents per ounce of alcohol as part of an overall effort to raise taxes.

"This is a regressive tax that will really hurt American middle-income workers - and cost Wisconsin jobs," said Kasten, a member of the Senate Budget Committee. "And it is a direct slap in the face to Wisconsin taxpayers.

"This tax increase is just another in a long list of atrocities - like the S&L bailout - that have unfairly punished Wisconsin citizens," Kasten explained.

Possible consequences

Noting that excise taxes are "10 times more regressive than income taxes," Kasten said that raising beer excise tax from 16 cents a six-pack to 81 cents will result in several unfavorable conditions in Wisconsin:

* A sales loss of 17.5 percent (Miller Brewing Co. would lose 7.3 million barrels of beer in sales).

* Nationwide job loss of 17.4 percent in the beer and wholesaling fields, resulting in a net job loss of 22,000 jobs.

* A loss in state and local excise tax revenue of $268 million.

"In Wisconsin, we have about 35,000 workers directly employed by the beer industry. A 17-percent reduction in sales could result in a Wisconsin job loss of 6,000," Kasten said, noting that the number is "probably low because it does not include the 40,000 Wisconsinites indirectly employed by the wholesale and retail industry.

"This beer tax increase is supposed to raise $7 billion. Instead of raising taxes on beer - and throwing Wisconsinites out of work - Congress can raise $7 billion by enacting my capital gains tax reform plan which would put more people to work by sparking economic growth," Kasten concluded.

Senator objects to

federal beer taxes

Sen. Christopher Bond (R-MO), objected on last week to a Republican proposal to sharply increase taxes on beer and wine to help reduce the federal budget deficit.

Bond, in a speech on the Senate floor, said it was "ridiculous" to suggest a fivefold hike in federal taxes on alcoholic beverages.

"To me it seems that this . . . proposal will single out one class of Americans who drink beer and say, `You are more responsible for the deficit than anyone else. Therefore, we are going to single you out to lay the tax burden on you,'" said Bond.

The increase in beer and wine taxes is reportedly part of a plan developed by the Bush administration to trim the deficit $54 billion next year. The plan has not been officially offered in talks between the White House and Congress, but details have been leaked to the news media.

Bond said White House budget director Richard Darman had told him that the administration "has not and will not propose such an unfair, outrageous and disproportionate tax on beer drinkers."

Bond said he had received thousands of letters from Missourians in opposition to the higher excise taxes on beer and wine. He said any proposals to increase revenues must involve a broad-based tax.
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Title Annotation:Wisconsin Senator Robert W. Kasten
Publication:Modern Brewery Age
Date:Aug 13, 1990
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