Sacramento Bee Editorial: Kiddie booze?

Published 2:15 am PDT Saturday, August 27, 2005
Story appeared in Editorials section, Page B6
If it looks like a duck and quacks like a duck ... then tax it like a duck.
Breweries since the 1990s have profited from a gray area between beer and hard liquor in alcohol laws, producing beverages known as "alcopops." These mixed drinks are strong, sweet-tasting and appeal to young people. They are known by brand names such as Smirnoff Ice, Bacardi Silver, Jack Daniel's Original Hard Cola, Skye Blue, Mike's Hard Lemonade.

But teenagers know them as "cheerleader beer" and "girlie beer" because of their popularity with underage girls. Studies back this up: Peak years for these drinks are ages 13 to 16, when it is illegal to drink alcohol, and the appeal is to girls more than boys. Women over age 21 rank alcopops as their least-consumed alcoholic beverage. This is a kiddie drink, not an adult drink.
The industry has been able to call these drinks "beer" or "malt beverages" rather than hard liquor because brewers start with a fermented base of beer. But here's the catch: Brewers remove the color and taste of beer. The alcohol comes primarily from added flavors that contain distilled spirits, producing an alcohol content that's stronger than beer and a drink with little or no resemblance to traditional beer.

Brewers have a stake in the question of beer vs. hard liquor. California taxes beer at 20 cents a gallon, distilled spirits at $3.30 a gallon.

California Attorney General Bill Lockyer sent letters to the state Board of Equalization and Department of Alcoholic Beverage Control in May noting that under California law any product that includes any amount of distilled spirits must be classified and taxed in California as a distilled spirit.

Yet these drinks continue to be taxed as beer.

Worse, legislators are poised to change California law to protect a beer classification for these drinks. AB 417 was gutted and amended Aug. 22 to guarantee that "flavored malt beverages" would be taxed as beer. Senators should defeat this bill.

The liquor industry is attempting to capture a youthful market and avoid higher hard liquor taxes. At a time when the state is trying to discourage illegal underage drinking and trying to get out of budget deficits, "flavored malt beverages" should be taxed as distilled spirits.