Thursday, March 17, 2011

Maryland Democrats Discover Hidden Costs of Excise Taxes

It's amazing how serendipitously liberals stumble upon economic realities.  Throughout this legislative session, liberal agitation groups have been lobbying for an increase in the excise tax on alcohol.  They plan to earmark that money for gratuitous health care entitlement programs for special interest rent seekers in the state of Maryland.

Suddenly, they have discovered that the DC government levies an additional 3-4% sales tax on alcohol, instead of an excise tax on the wholesale level.  They were never concerned about the market distortions that are induced by corporate or wholesale taxes in previous years.  Only now that they have discovered a model for double taxation on the consumer of alcohol, they decry the odious nature of wholesale excise taxes.  Here is the story from the Sun's Julie Bykowicz:

"Lawmakers have been weighing whether to raise the tax on alcoholic beverages since the first day of this year's legislative session. But the idea is getting a fresh look this week -- with a twist.
Health advocates recently learned that DC imposes a "special sales tax" on alcohol, charging an extra 3-4 percent on top of the regular 6 percent sales tax rate. Maryland, they argue, should follow the District's lead and develop its own special sales tax for alcohol."...

"Until recently, alcohol tax advocates -- and lawmakers -- seemed largely unaware that DC also taxes at the consumer level. A sales tax increase would eliminate the mystery of how much wholesalers and retailers will mark up their products.
"For 20 years, it's been the most powerful argument, that we shouldn't mess up that equilibrium, said Vincent DeMarco, president of the Maryland Citizens' Health Initiative, who has long advocated for increasing the alcohol tax. "But as we now know, all along, DC has actually has a higher alcohol tax, erasing that argument."
So these Democrat lobbyists never understood the nature of corporate level taxes until they discovered the fact that DC only taxes alcohol on a consumer level?  This is utter nonsense.  The reality is that they have always malevolently distorted the market with onerous taxes at the wholesale level.  It's only now that they have discovered another way to fleece consumers without damaging the liquor industry (directly), they are concerned with the effects of excise taxes.

I have a message for Mr. DeMarco of the parasite Maryland Citizens' Health Initiative.  If you are so interested in creating a redundant health care entitlement, why not use the money that you raise to fund your pathetic organization and expend it for that purpose?  That would be nobler than using your funds to lobby the legislature for the purpose of fleecing Maryland consumers.  Yes, those very same consumers that have been taxed and regulated into submission.  If you want to masquerade as a charitable non-profit public interest organization, why don't you lead by example and spend your own money?

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