Liquor Companies May Use Tax to Raise Prices

Are beer manufacturers using the tax increase as an excuse to raise prices?

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    TK
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    Beer manufacturers may use the upcoming tax increase to hike up prices on their products.

    Joe's six-pack is gonna get more expensive, but don't just blame the upcoming liquor tax.

    Liquor distributors may capitalize on the tax increase with price hikes of their own, according to at least one local liquor store owner.

    Ernie Olfe, proprietor of Cardinal Liquors on Route 21 in Gurnee, said he expects cases of beer to go for up to 70 cents more. That's above and beyond the tax increase, which would add only a few cents to beer sales. (Hard liquor, though, gets an additional 81-cents per fifth once the increase goes into effect September 1st.)

    "Miller is waiting for Bud to make a move and Bud is waiting for Miller to make a move," Olfe told the Lake-County News Sun. "They're using it, in my opinion, as an opportunity to be greedy."

    The tax is applied directly to the manufacturers, who will likely pass the increase on to stores. Stores will then pass the increase on to consumers in order to maintain their profit margin, said Olfe.

    The tax increase will help fund $31 billion in Illinois infrastructure projects.