Come Nov. 1, Alabamians will pay 5 percent more for liquor — no matter where they shop — after the state’s Alcohol and Beverage Control Board approved a markup on spirits at its last meeting.
The markup brings the state’s total to 35 percent over cost and was approved unanimously by the Board earlier this month after a preliminary approval in March and a period of public comment. ABC officials said the increase was necessary to level the playing field across the state given recent decisions in a couple of counties to increase their markup locally, driving up competition in surrounding areas.
“The change in markup will keep the price of a bottle, except in Calhoun and Marshall counties, basically the same everywhere in Alabama, and negates the need for the local sales tax bills,” Dean Argo, an ABC spokesman, wrote about the issue.
ABC Board regulations allow its members to increase prices only for specific reasons, including “timing to adjust for price increases or decreases by distillers, deciding whether short-term and/or small discounts extended by the distiller are to be passed through to customers, depletion of inventory of slow-moving items that are to be closed out and for other unique market circumstances.”
In addition to the 30 percent, now 35 percent markup, alcohol sales are taxed at 56 percent plus sales taxes, additional costs that will make a $10 bottle of liquor cost $22.32 starting in November, according to the Alabama Retail Association, which opposed the price jump.
But local law enforcement and prosecution officials said alcohol revenue, much of which is earmarked for their use, has been in decline in recent years, stymying already cash-strapped prosecutors for resources. In 2010, district attorneys received approximately $40 million in state dollars. Right now, though, they receive less than $30 million.
“This is a matter of being able to perform our constitutional duties,” one prosecutor told the ABC Board at its meeting.
Local DAs and the state’s judicial system could receive millions each year from the price hike, although this specific increase is not earmarked specifically for their use, something the same prosecutor said isn’t helpful for them.
“We have to have permanent, solid funding,” he said.
“It’s unfortunate this circumstance exists,” another district attorney, Tom Anderson, told members of the Board. “But these monies, this markup, it’s a lifeline for us to be able to serve victims … to be able to perform our constitutional functions. To be able to serve the people in the circuits that we live in.”
The Alabama Beverage Licensees Association, which represents more than 100 bars, package stores and restaurants, also opposed the increase.
“Any kind of increase is bad for our business,” a spokesman for the group said after the ABC Board met. “It’’s going to make it hard for our guys to survive.”