I was going to attempt to do a synopsis of this article in the Washington Post. It cannot be done. This article explains how Virgina will lose big bucks if the liquor stores are sold and they become private. Governor McDonnell doesn’t think the state should be involved in liquor sales. How hypocritical. They sure don’t mind taking taxes from the sale of liquor. So I don’t even want to hear the moral indignation surrounding liquor sales. The Governor also suggests that revenue will be made up in taxes because more liquor will sell because it will be cheaper.
The logic here is simply …missing. Besides, do we want more liquor sold? How is that concept fitting in with the Guv’s supposed moral objections to the sale of liquor. He needs to run the state and leave the liquor stores alone. Virginia needs to just keep raking in the $245 million dollars it is currently making on profits and taxes. Governor McDonnell needs to do the math and get over this hold over from the evangelical Pat Robertson school regarding booze.
Make sure you check out the interactive graphic. It is very interesting.
From the Washington Post:
Virginia’s inner struggle to get off the scotch tax
RICHMOND — For drinkers, a fifth of Jack Daniel’s costs about the same wherever they buy it — about $25 in Virginia and the District, a couple of bucks less in Maryland. But for the governments that regulate that bottle, the difference is as stark as a sip and a chug.
In the District and most of Maryland, just a dollar or two from a fifth of Jack Daniel’s goes to government. But in Virginia, where whiskey and every other kind of liquor is sold in state-run stores, more than $13 of the retail price goes to the state.
As Virginia Gov. Robert F. McDonnell (R) prepares to call the legislature into a special session to consider privatizing the state’s 76-year monopoly on the sale of hard alcohol, he faces a hard economic fact: The liquor business has been exceptionally profitable for the commonwealth.
Every shot poured and every cocktail downed is another cha-ching for the state, and that translates into hundreds of millions of dollars a year that are used to fund schools, prisons and mental health facilities.
Even after paying all of the expenses involved — buying millions of cases from distilleries, paying more than 2,680 employees, keeping the lights on and the rent paid at 332 stores — Virginia’s Alcoholic Beverage Control board deposited $248 million in liquor profits, as well as excise and sales taxes, into state coffers during fiscal 2009. And unlike nearly every other facet of government, the liquor business has proved to be essentially recession-proof, taking in $13.7 million more in fiscal 2009 than in 2008.
Regardless of the profits, McDonnell fundamentally believes that running the liquor business ought not to be a government function. He also believes that selling the system’s assets and new liquor licenses could bring in a one-time windfall of $300 million to $500 million, which he would use to improve the state’s ailing roads. A private system would also mean better selection and more convenient stores for consumers, he contends.
On Wednesday night, McDonnell held the first of a statewide series of town hall meetings in Roanoke, partly to sell the idea.