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State legislative sessions are just getting going, but a fair few tax proposals are already gaining attention. And this yr, many seek different structures for alc bev taxes rather than straight increases to existing, often volume-based excise rates. That's in addition to a group of bills designed to lower tax rates or expand access to the spirits-based RTDs and a growing number of proposals aimed at addressing drunk driving. Will a Tax by Another Name Smell as Sweet to Cash-Strapped Colorado Legislators? A pair of Colorado lawmakers intend to reintroduce a proposal to add new "fees" to alc bevs sold in the state. But whatever you do, don't call it a tax. The new fees amount to 12 cents per case of beer, 60 cents per case of wine and over $3 per case of spirits and aim to raise about $20 mil per year each to fund addiction prevention, treatment and recovery programs, the state's NPR station KUNC reported. That's all by design. The state requires all new taxes to be approved by voters. But the legislature can enact so-called "enterprise fees" that generate no more than $20 mil for a specific use that's linked to the industry facing the fee. Hence: proposal is positioned as "fees" not "taxes."This is a rehash of a 2024 effort that stalled, in part over resistance from Gov Jared Polis (who requested breweries be exempted). Facing threats to fed grant funding, treatment and recovery programs are eager for the state to fill existing gaps, they explained to KUNC. And with a state budget deficit ballooning to $850 mil, lawmakers may be just as eager for the pay-for. It's a 1-2 punch likely to drive proposals elsewhere, too.New York, New Mexico Weigh New Structure: Sales Taxes on Top of Existing Rates Lawmakers in New York also pointed to the precarious state of federal funding when announcing a bill to establish a 5% tax on retail alcohol sales designed to raise funds for substance use disorder services, the Times Union wrote. While current excise taxes go into the general fund, the new revenue would go directly to the state's Drug Treatment and Public Education Fund. A separate bill would direct an existing opioid tax to the same fund. Supporters of the bill specifically highlight laws that expanded access to alcohol in recent years, claiming more balance is needed. Separately, lawmakers in New Mexico are once again revisiting efforts to increase alcohol taxes there, this yr kicking off debate with a 3% sales tax, half the rate proposed by the same lawmaker last yr, the Santa Fe New Mexican noted.Hawaii Considers Saying Goodbye to Draft Beer Reduced Rate, Hello to ABV-Based Taxes The Aloha State could make a more drastic shift to its alc bev tax structure. The proposed "tax 'modernization' push," as the BI referred to it last wk, involves tossing out distinctions like beer, wine and spirits altogether in favor of charging rates based on ABV. That means eliminating the 40+% tax discount on draft beer, which would get the same $1 per gal rate for all bevs under 10% ABV, the Aloha State Daily explained. That's an increase of about 7 cents for packaged beer but a 46-cent, 85% jump for draft beer, which currently enjoys a steeply discounted tax rate.Alc bevs at 10-15% ABV would pay $1.75/gal (a drop in rate for sparkling wine, but a 45% hike on still wine). The initial proposal called for just a tiny 2-cent, 0.3% increase for most distilled spirits by moving to a new $6/gal rate on bevs at 16-40% ABV. But the bill's first committee, which passed it unanimously, recommended an amendment that would more than double that to $13/gal, while also including an exemption on the increase for brewers under 60K bbls/yr, according to the Daily.Oregon, Maryland and More Aim for RTD Adjustments Note that Hawaii's proposed change would also impact tax structures for canned cocktails, as all alc bevs would be taxed based on strength. But other states are also considering making changes for RTDs, BI shared late last wk. Oregon is one of the more notable efforts, as advocates seek to move spirits-based RTDs out of state-run liquor stores and into grocery stores, a proposal the BI, BA and state brewers guild is aiming to halt. New York could also move RTDs into the broader array of stores that currently sell beer, while a bill in Maryland aims to lower taxes for RTDs, per BI.Slew of Unusual Drunk Driving Measures Arrive Alongside WA's Perennial 0.05 Push The Washington Senate has already passed a bill to lower the legal limit for driving under the influence from 0.08% blood alcohol content (BAC) to 0.05%. It's one of two states (with Hawaii) where such a proposal has cropped up most years since Utah made the change almost a decade ago. However, the state already has a 15K-case backlog of yet-to-be-tested lab results from existing DUI cases, the Seattle Times editorial board pointed out this wk. A change to .05 would "lack the teeth to keep the most dangerous drivers off the streets," editors wrote, pointing lawmakers toward a separate bill designed to fix the backlog so existing cases are closed properly before drivers are let back on the road.Meanwhile, a handful of other states are taking different routes toward "safer roads." Members of the Alabama House unanimously passed a bill to require ignition interlocks for first-time DUI offenders, beyond existing penalties. Kentucky legislators look to block repeat DUI offenders from buying alcohol at all, a measure recently enacted in UT. In both AL and KY, lead legislative sponsors have been directly affected by drunk drivers. Advocates in South Carolina convinced the state Senate to unanimously pass a bill making a number of changes to how that state handles DUI testing, arrests and convictions. California and Kansas are also considering adjustments, tho again are so far focused on steeper penalties as deterrents, not the .05 proposal adopted in UT.

Taxes on the Table in Multiple States Seeking Funding, Often in New Forms; RTD & DUI Bills

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