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Push To Raise Alcohol Tax For Counties Faces Uphill Fight

January 26, 2015, 10:20 PM by Kevin Woster

Push To Raise Alcohol Tax For Counties Faces Uphill Fight

The excise tax on the sale of alcoholic beverages in South Dakota hasn't been raised in 28 years.  But now there's a push to boost the tax to help counties cover the cost of alcohol abuse.

It's an expensive business, by the time you figure in law enforcement and courts, abuse treatment and detox. And Pennington County Sheriff Kevin Thom says if you look into the lives of those in the county jail you'll often find a bottle.

"Anecdotally, without going and grinding through a whole bunch of hard data, I would say somewhere between 80 to 90 percent of our clientele, if you will, are the result of, you know, drugs and alcohol."

It's more than DUIs, Thom says.

"It's somebody gets intoxicated and they assault somebody or murder somebody," he says. "They have a drug problem or an alcohol problem where they get behind the curve in terms of paying their bills, so they steal from an employer."

Add the cost of alcohol abuse and treatment and it's millions of dollars a year for counties. That's why Rapid City Council President Jerry Wright is pushing for legislation to raise the alcohol tax and help counties with alcohol-related impacts. A similar effort by Matt Walz and Dan Jansa in Sioux Falls has legislation pending.

There will be strong opposition from the liquor industry. At Canyon Lake Liquors in Rapid City, owner Andy Schneider doubts the tax hike will get a warm welcome in Pierre, where the 2015 South Dakota Legislature is almost certain to see some form of the legislation.

"That seems to be the fix on everything, is add some tax," Schneider says. "And I think that's a very tough road for them to go. I think they ought to approach it from the standpoint of the big box stores that are selling it at cost and using the loss leader. Let's make them sell at a minimum of 10 percent over cost, and they'll raise all the tax revenues they want."

He hopes to see that issue discussed in Pierre, instead of the tax hike.

Matt Walz says twenty states have additional taxes on alcohol sales, typically called alcohol-impact fees, that help local governments with costs associated with alcohol abuse. He proposes a 7% fee for South Dakota, which counties would have the choice of imposing, or not.

And the tax would not apply to alcoholic beverages produced in South Dakota.


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