New California Alcohol Tax Bill

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September 24, 2015

During the recent special session of the California Legislature dedicated to healthcare funding, Assembly Member Susan Bonilla (D-Concord) introduced Assembly Bill X2-18, a bill to levy a 5-cent tax increase on distilled spirits sold at bars and restaurants. The bill was announced as a strategic approach to fund disabilities services. Proponents call it the "Cocktails for Healthy Outcomes Act."

ABX2-18 would address severe cuts to services for developmentally disabled Californians in the last decade and help the state comply with the Lanterman Act, which requires that such services be provided. A Public Policy Institute of California survey revealed that 62% of likely voters, and 73% of parents with children 18 or younger, support increasing state alcohol taxes.

California tax rates on beer, wine, and spirits are abysmally low, and have not seen an increase since 1991. Since California's alcohol tax rates are not annually indexed to inflation, the state beer tax rate has lost 42% of its value since its last increase. ABX2-18 includes an inflation index.

According to the Alcohol Justice tax calculator, a state nickel-a-drink increase for all types of alcohol would raise $802 million annually. Alcohol Justice supports this bill for raising the price of an under-taxed, harmful product and for raising revenue for health and human services. We also believe that a significant excise tax increase with an inflation index would be very efficient, and Alcohol Justice wiil soon be calling upon Governor Jerry Brown to introduce an increase in the alcohol excise tax in his FY 2016-2017 budget.

Take ACTION on the 5-cent cocktail tax here.

Bigger Big Beer

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September 24, 2015

It seems like yesterday we released the Big Beer Duopoly report, discussing the dramatic and speedy consolidation of beer producers taking place in the late 2000s. Now beer behemoth Anheuser-Busch InBev confirms that it approached another part of the duopoly, SABMiller, about a takeover that would result in a conglomerate of as much as $275 billion.

Meanwhile A-B InBev's counterpart and US joint venture MillerCoors LLC continues the trend of Big Beer buying up craft brewers - and California craft, at that. Big Beer continues to stave off threats of market share lost to somewhat smaller breweries, while making these plays to keep distributors in line. MillerCoors acquired Saint Archer’s and is already making plans to extend its brewer distribution beyond the state. Heineken was not far behind, with its new 50% stake relinquished from "smaller" Lagunitas Brewery (valued at roughly $1 billion).

And it doesn't look like the spending spree is ending anytime soon. The findings from our 2009 report echo resolutely in light of these recent beer deals:

• Shareholder rights and decision-making participation continue to disappear.
  
  
• Corporate consumption poses significant threats to the US three-tier regulatory system. While beer companies continue to deny interest in controlling beer distribution, they seek to buy distributorships wherever they can and force egregious contract provisions upon distributors who are backed into a corner to comply.
  
  
• Big brewers continue to grow and wield their influence on global, federal, state, and local lawmakers. Beer trade associations and allied partners spend millions to oppose the most effective and cost-effective policies to protect communities and reduce alcohol-related harm (increased prices/taxes, reduced availability, and restricted advertising and promotion).
  
  
• Beer remains the cheapest, most widely used drug in the U.S.