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Liquor is a revenue builder for state’s towns

Robert Houk • Dec 17, 2012 at 9:12 AM

Sometimes I drink whiskey, sometimes I drink rum

Sometimes I drink brandy, at other times none

But if I get boozey, my whiskey’s my own

And them that don’t like me, can leave me alone

Rye whiskey, rye whiskey, rye whiskey I cry

If the whiskey don’t kill me, I’ll live till I die

Country and western singer Tex Ritter — who made “Rye Whiskey” a hit song in 1946 — wouldn’t have a problem getting a belly full of booze if he was living in Tennessee today. The Nov. 6 election saw passage of 25 referendums in communities to either approve the sale of liquor-by-the-drink or to sanction package stores to sell it by the bottle. (Demon Rum was turned back by the voters in seven towns, including Oliver Springs, Henderson and Westmoreland.)

The big news locally was the passage of referendums approving package stores in Elizabethton and Unicoi. Voters in Church Hill also approved liquor-by-the-drink.

You’d have to look long and hard to find many “dry” counties in Tennessee today. Surprisingly, though, the Lynchburg home of the renowned Jack Daniels Distillery in Moore County is one of them. A special state law does give the distillery power to sell commemorative bottles in its gift shop.

Why all the clamor for legal spirits? An article in the recent issue of Tennessee Town & City, the official publication of the Tennessee Municipal League, suggests it may be that local governments are simply “thirsty for new revenues.” Ben Jenkins, a spokesman for the Distilled Spirits Council of the United States, said the tax revenues generated by alcohol sales can help local governments stave off property tax hikes and cuts to essential services.

Take the tiny town of Unicoi for example. The town levies no property taxes, and probably will never have to do so as long as it grows its sales tax base (it has a Walmart in its corporate boundaries, which is something few other towns of its size can boast) and it limits the services it renders to its citizens. Revenues from the alcohol taxes will just be the cherry on top of the sundae.

The Town & City reports liquor-by-the drink is taxed in Tennessee at 15 percent, in addition to the state and local sales tax levies. A $2.14 tax is levied on package store sales by the federal government. The state also levies a $4.46 tax on package store sales, as well as collects the state and local sales tax on each bottle sold.

There was a time when Johnson City was the only place to go to buy a legal drink in a bar or restaurant. The city was also a prime destination for residents in surrounding counties looking to buy a bottle of bourbon or Merlot. That’s not the case any more. Jonesborough now has both package stores and liquor-by-the-drink. With November’s vote, Elizabethton, will soon have both, too.

That’s a lot of whiskey being sold in the region. If she were alive today, Carrie Nation would be very disappointed with Tennessee.

Robert Houk is Opinion page editor for the Johnson City Press. He can be reached at rhouk@johnsoncitypress.com.

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