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Brookline liquor store managers split on effect of alcohol sales

tax repeal

Wicked Local staff photo by Keith E. Jacobson


At Foley's Liquors on Cypress Street, Victor Barakat, co-owner, discusses wine selection with Lubna Farhat on
Monday, November 8.

By Laura Paine/staff writer


Wicked Local Brookline
Posted Nov 10, 2010 @ 02:13 PM

Brookline — Liquor merchants throughout Brookline have different ideas about how their
sales will be affected now that Massachusetts residents have voted to repeal the sales tax on
alcohol, but many agree that dropping the tax will benefit customers.
Local voters disagreed with statewide voters: Approximately 75 percent of Brookline
residents voted to keep the 6.25 percent sales tax put in place in August 2009, by Gov. Deval
Patrick and the state Legislature. Statewide, 52 percent voted in favor of the repeal, which
will take effect Jan. 1.
David Ng, operating managing partner of Coolidge Corner Wine and Spirits on Beacon
Street, said that most of the store’s patrons live within a few blocks and usually walk to make
their purchases.
“As far as how much it affects this store, we’re not as exposed as a lot of our peer stores
are in the north and south. If you’re near the New Hampshire border, it would affect [sales] a
lot. I think for our actual sales, we’re a neighborhood store, and most of the folks who shop
here live in the neighborhood.”
But he also said that the repeal can only help. Carrie Anne Kelly, managing partner of
Brookline Fine Wine and Spirits on Harvard Street, said that the tax did have a serious
impact on her sales.
“When the tax was put into effect, all of us were impacted by it heavily,” Kelly said. “To
see business slow by nearly a third overnight was really disturbing. People were not only
curtailing their spending, but traveling out of state to do spending.”
Victor Barakat, co-owner of Foley’s Liquors on Cypress Street, voted in favor of the
repeal because it was a form of double taxation.
“The numbers show that [the sales tax] did not hurt us whatsoever,” Barakat said. “We
supported it because it was a tax on tax, not because of any business benefits, but it will help
the consumer for sure. If it wasn’t pre-taxed before it comes to the consumer then it’s fine,
you can add a tax on it, but why are you taxing the tax?”
Alcohol is already subject to a separate excise tax, though the state allocated money from
the added sales tax to substance abuse and prevention programs, as well as probation
departments and programs that put drug offenders into treatment, rather than prison. Barakat
said he isn’t sure that the tax revenue was actually funding the programs it was supposed to.
“I was looking at statistics, going online and talking with a group of people who
organized the Vote Yes on One campaign,” he said. “They were showing that the money
that’s coming into the state from the sales tax, about 80 percent was not going to rehab
centers. I don’t think the state is going to hurt from losing the revenue it was generating.
They should find other ways of generating tax money other than taxing something that was
already taxed.”
State Sen. Cindy Creem said that as far as she knows, the money is going to funding the
state programs. She said she was against repealing the tax, and that the argument that it was a
tax on a tax is not valid.
“What’s unfortunate is there are some really good programs being funded by that tax,”
Creem said. “It wasn’t understood by people what the tax meant. Forty-four states have a
sales tax on alcohol, and many have higher sales tax than we have. The excise tax at the
wholesale level is very small. The argument that is was a tax within a tax is not a good
argument. If we subtracted the excise tax it would still bring in a lot of revenue. My concern
at this point is that I don’t know what we are going to do about those programs.”
But Kelly said that the Vote Yes on Question One campaign did a great job in showing how
unfair the tax really was, and how much it hurt small businesses.
“It speaks to it being taxed at a distributor level, but then to turn around and essentially tax
the same item again; I’m not a history buff but I believe that would qualify as taxation
without representation,” Kelly said.
Although the sales tax on alcohol was repealed, voters did not opt to lower the sales tax
from 6.25 percent to 3 percent, which was estimated to have cut as much as $2.5 billion a
year in state revenues.
Laura Paine can be reached at lpaine@cnc.com.

Copyright 2010 Brookline TAB. Some rights reserved

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