As the legislature winds down in Harrisburg one issue can benefit the taxpayer if passed – HB 1661 prohibiting Pa. Liquor Control Board from taxing Pennsylvanians without legislative approval – and the other can severely place a burden on the taxpayer if included in the budget – a hospital tax increase currently being considered in budget negotiations.

Grover Norquist, President of Americans for Tax Reform wrote the following letter in support of HB 1661 and in opposition to the hospital tax increase.

To read letter in support of HB 1661, please read below.

To read letter in opposition to hospital tax, please click here.

June 23, 2011

Dear Members of the General Assembly:

On behalf of Americans for Tax Reform, I am writing in support of House Bill 1661 which prohibits the Pennsylvania Liquor Control Board (PLCB) from taxing Pennsylvanians without accountability or oversight.

In January, 2011 the Pennsylvania Liquor Control Board attempted to implement increased handling fees. Soon after, Governor Tom Corbett correctly stated that the Pennsylvania Liquor Control Board “didn’t get it” because the last thing he would allow under his watch was additional taxes or fees.

However, the Pennsylvania Liquor Control Board (LCB) still plans to increase the fee covering the operating cost of moving a beverage container, known as the Logistics, Transportation, and Marketing Fee (LTMF). The PLCB plan shifts the flat per beverage container fee of $1.30 to a 13% fee for future pricing.

The LCB plan shifts the flat per beverage container retail fee of $1.30 to a 13% fee for future pricing. Moving to a percentage based fee is effectively a tax increase on Pennsylvanians. For example, if a $10 beverage container becomes a $12 beverage container, the 13% fee will increase the cost by 26 cents. This “fee” hike will increase the shelf price of a product because suppliers will adjust to the increased fee price changes.

Furthermore, a 13% “fee” will hold back a growing industry in Pennsylvania. According to the Bureau of Economic Analysis, the number of jobs in leisure and hospitality – 512,500 – is up 2.5% since May 2010. Increased costs will prompt the consumer to buy less and employers will inevitably make adjustments to cope with the resulting reduction in revenue, potentially leading to job losses.

To prevent a monopolistic government entity from controlling Harrisburg, House Bill 1661 removes the LCB from the decision making chair and replaces it with elected officials who are ultimately held accountable by the people. Furthermore, this legislation affirms that elected officials are responsible for handling taxpayer money.

Lawmakers on Capitol Hill raised federal taxes by over $350 billion in just the past two years and the American people took note by throwing out those who refused to tighten the belt of the federal government. As such, it’s imperative that you not allow the LCB pile on with more job-killing taxes increases at the state level.

Due to the aforementioned reasons, I urge you to support and pass House Bill 1661. Please contact ATR’s Director of State Affairs Patrick Gleason at (202) 785-0266 with any questions.


Grover G. Norquist