Commonwealth Foundation Performs Study On Booze Bootlegging
According to a study from the Commonwealth Foundation, average prices for top-shelf wines and spirits out of state were found to be significantly cheaper than in-state options. The vast difference in price and selection has led to illegal bootlegging, which could potentially cost Pennsylvania millions of dollars annually.
The foundation, which tries to create free-market policies within Pennsylvania, examined Pennsylvania's top-50 wines and spirits prices, and compared them to all bordering states. Three of six states had lower prices, including Ohio which had prices as low as 25 percent cheaper. Delaware and Maryland also offer lower prices with more selection.
Director of Public Affairs for the Foundation, Jay Ostrich, says the consumer's right to selection and fair prices is the same for alcohol as it is for any product. "Pennsylvanians wouldn't put up with the government telling them what kind of jeans they should buy or what kind of groceries they should or could buy. But they also are saying they are not going to put up with government telling them what kind of booze they should buy," Ostrich says.
Although purchasing and transporting liquor across state borders is a crime, Ostrich says consumers are not concerned. "The studies are showing that more than 45 percent of consumers in just Philadelphia and its surrounding counties are purchasing their wine, all or some of it, from outside of Pennsylvania. So if some are living in fear of the law, those numbers certainly aren't showing it," Ostrich says.
According to Ostrich, a study performed by the state's liquor control board in eight counties surrounding Philadelphia found that out-of-state purchases account for $180 million in lost sales, including more than $40 million in annual tax revenue.
When the legislature returns later this month, the privatization of liquor stores in state will be a top Republican agenda item. Opponents of the privatization of liquor stores argue that the 18 percent state income tax on alcohol sold in private stores wouldn't last long. According to Ed Cloonan, policy director for the Independent State Store Union, private owners would argue it needed to be lowered in order to compete with private stores in other states.
Cloonan says the state system employs about 2,100 full-time employees and 1,000 part-time workers, at about 600 stores.