Washington: Study: Wash. has highest liquor sales tax in country

Source: KREM 2

Kaitlin Loukides

March 02, 2016

Washington state is set to have another year where the state has the highest liquor sales taxes in the entire country, according to a study from the Washington Policy Center.

To put this into perspective for you, get this – nearly 40 percent of every sale on every bottle of liquor goes back to the state of Washington. So, as you could imagine, smaller businesses only see a couple of cents for every dollar they earn.

If you live in Spokane, and you want to buy liquor for a party, you will probably go to Idaho to avoid the high taxes.

Don Poffenroth is the co-owner of Dry Fly Distilling. He said he and many other local brewers who have been in the game for years are surprised prices did not go down as expected.

“Because we were removing the state government from that equation, we thought the prices would come down,” he said.

Poffenroth said that did not happen because then the government added more taxes onto the equation.

According to the Washington Policy Center, Washington state was taxed more than 33 dollars per gallons of liquor, whereas in Missouri, they were taxed only two dollars per gallon.

A further breakdown reveals that on every liquor sale at a local store, there is a 17 percent liquor tax, a 20.5 percent sales tax, and a 1.7 percent liter tax.

Poffenroth said this is putting smaller businesses out, driving more people to Idaho to buy their liquor and making it nearly impossible to spark competition.

“Getting in the game today, the price of entry is 10-times what it used to be,” Poffenroth said.

Poffenroth did say he does not expect the sales taxes to get any higher in the coming years.