State Alcohol
Policy
In California, an amendment to the State Constitution in
1955 created the Department
of Alcoholic Beverage Control (ABC) and gave the agency the exclusive authority regulating
the manufacture, distribution, and sale of alcoholic beverages.
The ABC interprets their licensing, enforcement and regulatory
mandate as requiring them to act in cooperation with local
communities.
Licensing
All sales of alcoholic beverages must be licensed by the
state. In California, ABC has the exclusive authority to license businesses
to sell alcohol. California has a three-tiered licensing
system, with distinct licenses for manufacturing, distribution,
and retail. There are over 70 license types for the three
tiers, including temporary permits for special events.
The mission of the Department of Alcoholic Beverage Control
is to administer the provisions of the Alcoholic Beverage
Control Act of the Business and Professions Code in a manner
that fosters and protects the health, safety, welfare, and
economic well being of the people of the State. Developing
a good relationship with the District Administrator of local
ABC office can be essential to a successful effort to deal
with issues related to licensed alcohol establishments.
Find the Alcohol Control Board in your state!
Alcohol Taxes
State governments, as well as the federal government, can
levy alcohol excise taxes. States levy two major types of
taxes on the sale of alcoholic beverages:
- Ad valorem taxes are value-based taxes usually
levied as a percentage of the product's retail sales price
(which may also be referred to as gross receipts, gross
proceeds, retail receipts, or retail proceeds). In a limited
number of jurisdictions, the tax is based on the wholesaler's
price to retailers or the producer's price to wholesalers.
- Volume taxes, also called per unit taxes,
are levied as a dollar amount on a specified volume (in
liquid measure—e.g., gallons, ounces, or liters)
of alcohol beverage. These taxes are not always labeled
as such. For example some States call volume taxes "fees" or "levies.”
Taxes may vary within a given jurisdiction by beverage category
(spirits, wine, beer, and coolers). In addition, alcohol
tax rates are typically based on the level of alcohol content,
with higher-alcohol content beverages taxed at higher rates.
Accordingly, jurisdictions make taxation distinctions among
beverages with varying alcohol content, usually expressed
as a range [e.g., <5 percent Alcohol by Volume (ABV)].
An additional distinction involves whether the alcohol content
range is expressed as Alcohol by Volume (ABV) or Alcohol
by Weight (ABW).
States often give special consideration to beer taxes. They
define beer (malt beverages) in a variety of ways, usually
based on alcohol content. Beers with relatively high alcohol
content (more than 6 percent) may have higher tax rates.
Virtually all beers on the market are 16 percent alcohol
or less. Beers that have higher alcohol content often contain
distilled spirits and, therefore, may be subject to distilled
spirits taxes.
California is one of three states that require a two -thirds
vote of the legislature for tax increases, which can make
it difficult to increase the alcohol tax. For more information
on state alcohol taxes, go to the following website: www.healthpolicycoach.org/doc.asp?id=516o#
The
Center for Science in the Public Interest’s Alcohol
Policies Project website has a special section on alcohol
taxes, a tool to calculate the effects of alcohol tax increases
by state, and an action guide at www.cspinet.org/booze/
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