HB757: relative to the beer tax.

HB 757-FN-A – AS INTRODUCED

2007 SESSION

07-1007

09/01

HOUSE BILL 757-FN-A

AN ACT relative to the beer tax.

SPONSORS: Rep. Mulholland, Graf 10

COMMITTEE: Ways and Means

ANALYSIS

This bill changes the method for calculating the beer tax.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

07-1007

09/01

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Seven

AN ACT relative to the beer tax.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Tax on Beer. Amend RSA 178:28, I to read as follows:

I. In addition to the annual license fees provided in this chapter, a fee of [$.30 for each gallon] 5 percent of the wholesale value per 12 ounces of beverage sold or transferred for retail sale or to the public shall be required for licenses issued to wholesale distributors, beverage manufacturers, and brew pubs; provided, however, that if beverage container mandatory deposit legislation is enacted, such fee shall be [$.18 per gallon] 2.5 percent of the wholesale value per 12 ounces as of the effective date of such legislation. For failure to pay any part of the fees provided or under this section when due, 10 percent of such fees shall be added and collected by the commission from the licensee.

2 Beer Festival Licenses; Tax on Beer. Amend RSA 178:30, V to read as follows:

V. Beverages registered with the commission under paragraph IV shall be purchased by the holder of the license. Additionally, fees of [$.30 per gallon] 5 percent of the wholesale value per 12 ounces of beverages or specialty beer purchased under this paragraph shall be paid to the commission by the licensee within 10 business days of the expiration of the license. Payment shall be accompanied by any forms and documentation required by the commission.

3 Effective Date. This act shall take effect July 1, 2007.

LBAO

07-1007

01/30/07

HB 757-FN-A - FISCAL NOTE

AN ACT relative to the beer tax.

FISCAL IMPACT:

The Liquor Commission has determined this bill may have an indeterminable fiscal impact on state revenues and increase state expenditures in fiscal year 2008 and each year thereafter. There is no fiscal impact on county and local revenues or expenditures.

METHODOLOGY:

The Liquor Commission states this bill changes the way beer is taxed from $0.30 per gallon to 5% of wholesale value per twelve ounces sold to retail which would make beer tax collection and enforcement more complicated and difficult. Tax forms currently used by the Commission and industry will have to be changed to reflect sales value per different packages and brands in lieu of accounting for sales by the gallon. The Commission currently licenses over 300 different brands of beer and there are over 100 different package sizes sold. Each brand of beer may have eight to ten different packages of the same quantity of beer (i.e. six pack) that all wholesale for a different price. The Commission would need to keep track of all these different packages and the tax on each. The Commission currently collects the same amount of tax on packages of the same size regardless of the value of the product, which can vary greatly between brands. Currently a case of 24 twelve ounce bottles, the equivalent of 2.25 gallons, is taxed at $0.675 per case. For a 15.5 gallon keg of beer the tax is $4.65 per keg. The proposed change may result in the state collecting more taxes in some instances and less in others. At a current tax of $0.675 per case, the average price of a case of beer would have to be equal to $13.50 in order to generate the same amount of tax at 5%. At a current tax of $4.65 per keg, the average price of a keg of beer would have to equal $93 in order to generate the same amount of tax at 5%. The fiscal impact on expenditures due to increased complexity of enforcement and the need to change the current tax form can not be determined.