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A tax or fee over Oregon liquor?

May 7, 2014

Associated Oregon Industries
Oregon’s largest business advocate

The Oregon Supreme Court ruled that the wording of a ballot title description on privatizing liquor sales must be changed. The description, written by the state’s Attorney General, currently contains the word “taxes” to describe the fee wholesalers would have to pay the Oregon Liquor Control Commission (OLCC) under the proposed law.

This fee would be equal to roughly 72% of the wholesale price of a bottle of liquor, plus 75 cents. It is intended to replace revenue the OLCC would lose if the state’s control of liquor sales was repealed. Supporters of liquor privatization do not want the word “taxes” included in the ballot description because of the word’s negative connotations.

The Court ruled that using the word “taxes, without modification” fails to adequately describe the change to how the OLCC obtains the revenue, but added that “the money that wholesalers must remit to the OLCC has more attributes of a tax than a fee,” going on to suggest describing it as a “wholesale tax.”

This ruling addresses one of two petitions submitted by proponents. The second title description includes the words “sales tax,” which proponents asked to have removed. Once the Court rules on that issue and the ballot descriptions are satisfactorily rewritten and approved, one of the titles will be circulated to gather signatures for the November ballot. The deadline to turn in signatures this year is July 3.

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