By Emily Wood
 
February 26, 2009
 
MEDFORD, Ore. - A proposed beer tax increase is coming to a head in Salem.
 
Advocates and critics met with lawmakers earlier this week to make their case over the proposed 1,900 percent beer tax increase.
 
Oregon currently ranks 49th among states in its malt beverage tax rate, which hasn't been raised since 1977. The current tax on a 12-ounce glass of beer is less than a penny. The increase would raise the tax from $2.60 a barrel to nearly $50.
 
State House Republican Ben Cannon, who introduced Bill 26-41, is proposing using the revenue for drug and alcohol treatment. He says if beer sales match what they were last year, the tax revenue would bring more than $300 million for the state over the next biennium. Those in support of the bill insist it's the only way to keep Oregon's treatment facilities open.
 
"A raise in the beer and wine tax would enable us to continue to provide services at the level we're providing them in spite of the states budget shortfall," says Rogue Valley Addiction Recovery Center Ed Burns.
 
Opponents claim say the tax would cut jobs in the restaurant and the brewing industry. Brewers say customers could pay $2 more for a six-pack and a $1.50 more for a pint.
 
"With any decrease in sales volume because of a proposed sales tax there are going to be job losses. There are going to be businesses that are going to go out of business because of this," says Wild River Restaurant and Brewing General Manager Shaun Hoback.
 
Hoback says the problem isn't that the state is looking to raise the tax, it's that the increase is too large. If the bill passes as is, Oregon would go from the second lowest tax in the nation to the highest.
 
Oregon is among the top five states in microbreweries per capita. Portland has the most microbreweries per capita of any city in the nation.