Evening star., 1949-07-19
Beer and Liquor
Price Rise Due
With Sales Tax
1-to-5-Cent Increase
To Be Passed ALONG
To Public Aug. !

The price of beer and cocktails
in Washington restaurants, hotels
and taverns will increase by to
cents August l when the Districts
2 per cent sales tax goes into ef-
feet, it was learned today.
Robert ]. Wilson, executive sec
retary of the Washington Restau-
rant Association, predicted the
standard 10 and IS cent prices on
draft beer will increase to any
where from IL to 20 cents a glass.
Bottled beers. now priced at Is
and 80 cents in most establish .
ments. probably will go up l to 2
cents bottle.
Bourbon, gin and other hard
liquors also will be increased or
more cents a drink in many res
taurants and tayerns after August
l, Mr.. Wilson said
Each proprietor will have 10 de-
eide for himself how much the
new levy-plus the so per cent in
crease in liquor license fee-is
costing him and raise the price
accordingly, Mr. Wilson said.
There will be no concerted action
because of the antitrust laws, he
added.
Equipment Also Taxed.
The city's more than 1,10O res
taurants and bars are getting
ready for the new tax, Mr.. Wilson
said. and will pass it along to their
customers. He said the public
does not realize that proprietors
themselves must pay sales tax
on restaurant equipment they buy
and that this adds to the operat-
ing costs.
Since drinks under ID cents are
tax-exempt. it was explained that
draft beer drinkers could escape
the sales taX-unless barkeeps
raise the price of the beer itself
by paying for each 10-cent glass
separately. This would throw the
tax burden on the seller since the
Sales Tax Act does not specifically
require an increase in. the price
of any commodity, but does re-
quire the vendor to pay 2 per
cent tax on his gross receipts.
whether he collects the levy from
his customers or not.
Hence. draft beer sellers are
expected to forestall tax-free
drinking by increasing the price
to cover themselves.
OF course. draft beer drinkers
who let their checks accumulate
will pay the tax as we'll as the new
price.
Operation of Tax Explained.
Those who drink bottled beer
in restaurants-since bottled beer
never costs less than 25 cents here
will be paying both the tax and
the new price.
The tax will work as follows for
those who dine and drink in public
places:
Liquor checks from l to 13 cents
Liquor checks from IA
to SO cents-1 cent tax. Liquor
checks from 81 cents to $1.13-2
cents tax.
Food checks in restaurants Of
$1.25 or less are exempt. Food
checks from S12 to $1.63-3 cents
tax. The tax increases l cent for
each additional so cents on the
check thereafter.
If group of people dine to-
gether the checks will be consid-
cred separately for tax purposes
that is. those individual meals
costing Sl.25 or less are exempt
and those over that price are
taxable.
Committee to Aid Owners.
The beer or liquor a customer
consumes with his meal also is
considered separately from the
food price for tax purposes. Thus,
a person eating 80 ce,.ts worth
of food and drinking one 65-cent
highball would pay no tax on the
meal, but 2 cents on the highball.
Mr.. Wilson said the restaurant
association has set up a perma-
nent committee at association
headquarters to assist restaurant
keepers in their function as tax
collectors. The association has
all the forms and information a
proprietor needs to operate under
the tax.
They also have cards printed
with the tax scales and placards
for display in restaurants for ex-
MIA ininn the leux To cl1stnnaerS