Skip to main content Skip to office menu Skip to footer
Capital IconMinnesota Legislature

Increased alcohol taxes proposed

Published (3/18/2010)
By Lauren Radomski
Share on: 

Increased taxes on alcoholic beverages would be used to fund alcohol abuse-related expenses, under two bills held over by the House Health Care and Human Services Finance Division for possible omnibus bill inclusion.

Minnesota imposes two types of special taxes on alcoholic beverages: a fixed excise tax on manufacturers or wholesalers that varies by beverage type, and a gross receipts tax of 2.5 percent on off-sale and on-sale retailers. Rep. Karen Clark (DFL-Mpls) sponsors two bills that would increase both taxes in order to provide funding for chemical dependency treatment and law enforcement costs related to substance abuse.

HF1896 would double the gross receipts tax on retailers, with half of the proceeds going to the General Fund and half going to an “alcohol health and judicial impact fund.” The impact fund would help local governments cover alcohol-related expenses, like the cost of incarcerating DWI offenders.

“We are talking about a user fee,” Clark told the division March 16. “ (It) begins to pay for some of the incredible costs that are associated in our society and in our state with alcohol and chemical abuse.”

The second bill, HF2125, would increase the excise tax on manufacturers and set new procedures for chemical dependency treatment.

State costs associated with untreated alcohol and substance abuse are far-reaching, said Carol Falkowski, director of the Alcohol and Drug Abuse Division of the Department of Human Services. Untreated abuse can threaten public safety, compromise parenting, disrupt education, increase demands on the health care system and impair a person’s ability to keep steady employment, she said. A Columbia University study found Minnesota spent $2.8 billion on substance abuse and addiction in 2005.

The alcoholic beverage industry is already “uniquely taxed,” with total taxes reaching $300 million in 2008, said Joseph Bagnoli, an attorney representing a coalition of alcohol beverage providers and producers. He said the industry is being singled out, despite the fact that alcohol has no health detriments when used properly.

A companion to the gross receipts tax bill, SF3200, sponsored by Sen. Linda Berglin (DFL-Mpls), awaits action by the Senate Commerce and Consumer Protection Committee. Sen. Steve Murphy (DFL-Red Wing) sponsors SF1617, a companion to the excise tax bill. It was part of last year’s vetoed omnibus tax bill.

Session Weekly More...

Session Weekly Home

Related Stories

HHS bill is DOA but hoping for CPR
Supporters cite gaining federal funds, governor concerned about spending
(view full story) Published 5/13/2010

House passes HHS budget bill
Members reluctantly vote for cuts; governor says bill is too costly
(view full story) Published 5/6/2010

Not cutting as deep
Although painful now, omnibus HHS budget bill could set stage for reform
(view full story) Published 4/29/2010

Revisiting GAMC
Program participation questionable, hospitals favor earlier federal reform
(view full story) Published 4/22/2010

A distress call for SOS?
State Operated Services plans programmatic redesign, amidst criticism
(view full story) Published 4/22/2010

Minnesota Index: Health coverage
Figures and statistics on health coverage and other vitals
(view full story) Published 4/22/2010

Inking a deal for donors
State oversight of body arts could reduce donor deferrals
(view full story) Published 4/15/2010

Nursing a level playing field
Sides differ on who should pay for nursing home costs
(view full story) Published 4/8/2010

Saying ‘sorry’
House resolution would apologize for practices done decades ago
(view full story) Published 3/25/2010

And the cupboard is bare
More Minnesotans struggle to put food on the table
(view full story) Published 2/25/2010

Future of GAMC uncertain
Legislators consider health care for state’s poor, sick
(view full story) Published 2/11/2010

At Issue: Health care law quagmire
Sustainability at issue in law line-item vetoed by governor
(view full story) Published 5/29/2009

At Issue: More compromise, more reductions
Cuts in health and human services finance bill called ‘painful’
(view full story) Published 5/15/2009

At Issue: Cuts hang in the balance
Much depends on tax increases
(view full story) Published 5/1/2009

At Issue: Providing ‘pretty darn good coverage’
A new approach to public health could save millions in benefits, advocates say
(view full story) Published 4/10/2009

First Reading: Complex problem, complex solution
Cuts to health and human services could create reform opportunity
(view full story) Published 4/3/2009

Minnesota Index: Health boards
Figures and statistics on health licensing board in Minnesota
(view full story) Published 3/13/2009

At Issue: Medical marijuana
Controversial treatment clears first committee hurdle
(view full story) Published 2/20/2009

Minnesota Index: Less lighting up
Figures and statistics on smoking in Minnesota
(view full story) Published 2/20/2009