An odd sort of dance between fact and fiction is playing out in California this week. The State Board of Equalization (SBE), California Controller John Chiang and a number of groups that oppose alcohol or want to fight underage consumption all want us to believe they have discovered the answer to youth in the state getting buzzed on malternatives.
By a 3-2 vote, the SBE took the step to reclassify drinks like Smirnoff Ice as a liquor, rather than a beer. The result is the tax on what some groups call alcopops will jump from 20-cents a gallon to $3.30 a gallon. Never mind the fact that these beverages are malt based and carry an alcohol by volume level that is close to most beer -- not 80 proof vodka.
One analysis of the situation computed that the reclassification will increase the price of a 12-ounce malternative by 29-cents. That's right, California officials want us to believe that 29-cents is the answer to teenage drinking issues in the state. They are supported by propaganda spread by the neo-Prohibitionists at the Marin Institute. That group claims the new tax will cut malternative sales by 35 percent. Presumably, the Marin Institute wants us to believe that more than a third of sales for Mike's Hard Lemonade, Zima and other brands come underage consumers and it will all end overnight.
Just where will these newly sober teens turn? I doubt the answer is green tea. So once the SBE and the Marin Institute tracks them down -- perhaps in the beer section -- expect the "tax them and they won't drink" logic to crop up again. And, if they still long for the flavor of a Seagram Mellon Smash, they will still be able to buy the products in grocery stores because the California Department of Alcoholic Beverage Control is not acting to reclassify the beverage. If they did, consumers would have to go to a liquor store to buy them.
What's really going on here is that some regulators have found an easy target: Malt beverages with brand names usually found on vodkas, rums and whiskeys. The logic is impecably governmental. I bet some of these jokers think the Golden Gate Bridge is made of real gold. In the end it becomes a question of tax revenues for the state. California stands to make $41 million more in taxes from the switch.
The new tax still has to go through several administrative rubber stamp sessions and will likely hit sometime next year.