If you're planning to stock up on adult beverages for your Fourth of July party on Monday, you might want to do it by Thursday.
On Friday, the alcohol tax hike approved by the Maryland General Assembly goes into effect, raising the sales tax on alcohol from 6 percent to 9 percent.
At Wells Discount Liquors on York Road, managing partner Mike Hyatt said he's tried to educate his customers about the tax hike as it draws near, with messages on mailing lists and the store's marquee.
"A lot of people are stocking up, not as many as I thought would happen, but I think as it grows closer ... I think that the stores are going to see more action." Hyatt said.
Hyatt, who went to Annapolis to testify against the bill, said the tax increase is much less damaging to retailers than the "dime a drink" excise tax in the original bill. That would have directly raised the excise tax—and the sticker price—for alcoholic beverages. The sales tax increase translates to roughly a nickel more per drink.
Doug Marcus, owner of Towson Wines and Spirits, said he's fine with the new tax ("I just want to know where the money goes," Marcus said) and doesn't expect to lose much business over what he said amounts to a 25-cent price increase for the average customer. Instead, he's ramping up his discounts and posts on his Twitter and Facebook pages.
"It's all I can do," he said. "I'm trying to make it as painless as possible."
Jeff Bartlett, a spokesman for Total Wine and More, owners of Beltway Fine Wine, said the store is putting up signs to let customers know about the tax increase, but they don't plan to have any sales.
State analysts expect the tax hike to raise $84.8 million in the 2012 fiscal year alone, according to a fiscal note on the bill. Much of that money in the first year will go to Prince George's County and Baltimore City schools, with some money set aside for health care programs for the disabled. The latter had been trumpeted as the original impetus behind the bill.
Vincent DeMarco, president of the Maryland Citizens' Health Initiative, which lobbied hard for the bill, said he was "ecstatic" with what the group was able to accomplish, even it it doesn't accomplish all that the group was shooting for. He said other states may use the bill as a model.
"It will save many lives by reducing underage drinking and alcohol abuse and it's great that the governor stood up to the alcohol lobby and got it passed," DeMarco said.
He said the group will work with legislators to get future revenue from the tax increase directed exclusively toward health care programs.
"We're fine with money going to education the first year, but that's just the first year," he said. "The needs are much greater than even the money we even initially proposed to raise."