My research brief today examines the unique problem posed by local government revenues from liquor sales under North Carolina’s ABC system.
In it I discuss three different proposals for addressing it: a 12 percent local excise tax (suggested by the General Assembly’s Program Evaluation Division); a lower local excise tax supplemented by a local option excise tax (suggested in my report as a way to smooth the vast disparities produced by the local excise tax); and a flat tax per gallon of liquor (suggested in legislation last year).
As I point out, however, they’re all
attempts to get around artificial problems created by a needlessly complex state/local government hybrid system set up to control alcohol sales that, after the fact, became attractive to state and local government to deliver monopoly revenues.
What to do in the meantime? My brief has some ideas, and they are fleshed out with more listed here in this piece entitled “Why does North Carolina have these alcohol restrictions?“