The axiom that "politics make strange bedfellows" is regularly proven to be true. Just as often, though, policy differences divide close friends.
That's the position in which many of us in organized labor find ourselves as we consider the Minnesota House's tax plan.
We worked hard for the election of candidates who pledged to increase taxes on high-income earners, in order to ensure more equitable taxation of the state's residents. Organized labor has been proud to support Gov. Mark Dayton's call for a new, fourth income tax tier so that the wealthiest 2 percent don't pay a lower effective tax rate than the middle class.
The Teamsters union is in full support of the House's inclusion of the governor's marquee tax proposal — and of other major provisions in its bill.
But one thing sticks in our throat: the massive, 600 percent increase in the alcohol excise tax.
There are several reasons why this increase is bad policy and at fundamental odds with both DFL and labor values.
First, it represents a tax on the working class. The liquor excise tax — combined with up to five other taxes (federal excise, state gross receipts, bottle tax, and state and local sales taxes) — is extraordinarily regressive. Affluent Minnesotans can more easily afford $4 more per case of beer (or $2 more on each bottle of wine or spirits) than can middle- and lower-income Minnesotans.
We're told it is equivalent to just 7 cents more per drink. But the liquor industry's experience is that consumers will face at least double that cost after tax multipliers and added costs of doing business. Still small change for consumers, you say? Tell that to people having a hard time making ends meet. They don't recall voting for Democrats on a promise to raise the price of their beer or margarita.
