PLEASE HELP US: INITIATIVE 1183 NEEDS CHANGES!
EMAIL YOUR LEGISLATOR TODAY--WE DON'T HAVE MUCH TIME!
INDEPENDENT GROCERS NEED TO PARTICIPATE IN LIQUOR PRIVATIZATION TOO!
Initiative 1183, the liquor privatization initiative, has passed. The Washington Food Industry Association OPPOSED this initiative because the way the initiative is currently drafted, the tax laws are too complex for most independent grocers' point of sale systems to accommodate without very expensive changes. In addition, the laws on warehousing, licensing of warehouses and distributors, and the ability to purchase direct from the distiller actually put a wholly-owned chain store with its own warehousing and distribution systems at a significant competitive advantage.
As the Initiative transitions to a bill, Washington Food Industry Association is urging legislators to immediately make the following changes to ensure that the state's independently owned grocers, wholesalers and distributors can compete on the same playing field as large corporate chain stores that own their own warehouse and distribution systems.
The first two changes must occur during the special session in order to aid compliance prior to effective dates in the bill and to ensure that enough distributors are participating in the new system so that the state can more fairly and easily recoup the $150 million guaranteed from distributors:
1. The way the initiative is currently drafted, the tax laws are too complex for most independent grocers' point of sale systems to accommodate without very expensive changes. Without an immediate change to how the taxes are administratively collected, many independent grocers may find it difficult to sell the product simply because of the cost of calculating the taxes. These taxes need to be simplified prior to the first date distributors can sell to retailers -- March 1.
LEGISLATIVE PROPOSAL: In a revenue neutral calculation, collapse the seven existing retail taxes and wholesale taxes (reiterated in Sec. 106 of the initiative) into one per liter tax levied at wholesale and imbedded in the price and then levy the retail sales tax at the retail point of sale. This will make the administrative tax structure of spirits similar to the administrative tax structure of beer and wine -- a product currently sold in private retail outlets and for which independent grocer point of sale systems are already adapted.
2. A wholly owned chain store with its own warehousing and distribution systems can purchase high volume spirits direct from a distiller at a significant competitive advantage because they would not have to pay the first year surcharge if the state does not obtain $150 million from distributor license fees. OFM projects a $60 million surcharge will be needed. Without this change, many potential, legitimate distributors may avoid becoming licensed because the cost of the surcharge would not be shared and would present them with much larger costs. They simply will wait a year thus exacerbating the need for a surcharge. Access to product could be impeded for independent grocers.
LEGISLATIVE PROPOSAL: Include spirits "certificate of approval holders" in all sub sections of Sec. 105 -- particularly 105 (3) (c) of the initiative which deals with spirits distributor licensees and how the license fees are paid. This will ensure that if a retailer purchases direct from a distiller in the first year, the distiller, acting as the distributor, will also be included in the surcharge if $150 million of license fees are not collected. With this change, ALL retailer inventory, regardless of how it is purchased, will have to participate in the payment of the surcharge so that no retailer can avoid this cost in the sale of the product. This address access and cost for both distributors and retailers regardless of size.
The third change is something we would like to see in the regular 2012 Legislative Session:
3. The 10,000 square foot limit does not truly define an independent neighborhood grocer from a "convenience store." Many neighborhood grocers who are a major source of food shopping for urban and rural residents are less than 10,000 square feet but have greater than 7,000 square feet. 7,000 square feet is the number that should have been used. Without this change, some neighborhood grocers may see their customers go to big chain stores simply because they can engage in one stop shopping -- particularly around holidays and big events.
LEGISLATIVE PROPOSAL: Lower size restrictions to 7,000 square feet in size. Some independently owned, family grocers are under 10,000 square feet in size -- particularly those in small, rural areas or urban neighborhoods. 7,000 square feet is a more realistic determinant of whether a store is a grocery store or a convenience store.
CALL TO ACTION:
Email your THREE legislators (1 State Senator and 2 State House Representatives) TODAY and urge them to support changes to Initiative 1183.
WE WROTE A 1183 LETTER FOR YOU!
We've already pre-written a letter for you to send. It's Easy! Just hit the TAKE ACTION button and you can use our exact text or you can add some of your own to personalize it!
Thank you for your support! Click Here!
http://www.foodaction.net/WFIA/default.aspx
THANK YOU!
For more information contact:
Jan Gee
President & CEO
253.209.5079
|