Distilled Spirits Council slams ‘tampon tax’ reform

The Distilled Spirits Council has urged California lawmakers to reject a bill that would shift tax paid on tampons and nappies to spirits, warning it would “devastate” restaurants and small businesses.

A new tax in California could “devastate” hospitality, the Distilled Spirits Council says

Assembly Bill 479 was proposed by Democrat assembly members Lorena Gonzalez Fletcher and Cristina Garcia. The legislation would see nappies, tampons, pads and other essentials made exempt from tax, with the duties levied on spirits instead.

“It’s time to tax liquor before ladies,” said Garcia, according to the Los Angeles Times. “I challenge anyone, Democrat or Republican, who wants to say it’s not worth 2 cents per hard alcoholic drink to pay for these very basic necessities,” Gonzalez Fletcher added.

The Distilled Spirits Council warned that in its current form, the assembly bill would “devastate” businesses, cause an estimated loss of US$170 million in retail revenue each year and could cost 2,400 jobs.

“Exempting diapers and health products for women from sales tax is a laudable goal and one that has been successfully achieved in other states,” said Distilled Spirits Council vice president Adam Smith. “However, shifting the tax burden onto the state’s already overtaxed hospitality sector is not sound public policy.

“The goal of helping women and families afford life’s necessities is important, but should be part of a larger over-all budget discussion. Simply tacking on another liquor tax will result in job losses throughout California restaurants, bars and hotels – including many much-needed jobs held by women.

“Spirits are already overtaxed in California with more than 50% of the price of a bottle of spirits going to a tax of some kind. Consumers respond to higher prices by making fewer purchases. That means less spending at restaurants and retail stores, less revenue for hospitality businesses and ultimately fewer jobs.”