Drink levy taxing for bars, restaurants

As residents toast 2008 with champagne, the county's 1,902 retail liquor license holders will re-wire registers and scrap old menus as they work out kinks in how to collect the new 10 percent drink tax.

"It's just not as easy as saying, 'We're going to slap 10 percent on that,'" said Pat McDonnell, who estimates his six Atria's locations in the county will generate $500,000 in drink tax revenue a year. "We're taking care of business right now. We don't have a chance ... to think about how we're going to collect the tax."

John Petrolias said he will ring in the New Year behind a computer as he spends hours reprogramming files to reflect when and if the tax applies to 332 different drink items at The Smithfield Cafe, Downtown.

"If they want it Jan. 2, it's going to take me all day New Year's Day," said Petrolias, 71, of O'Hara, who spent $2,000 two months ago to print menus that soon might be outdated. "I'm not going to spend another $2,000 for Dan the Tax Man."

County Chief Executive Dan Onorato continues to deflect criticism about the tax, which takes effect -- along with a $2-per-day rental car tax -- in just 18 days.

"Allegheny County is the only county in Southwest Pennsylvania that has not raised (property) taxes in six years," Onorato said Friday. It's a statement he has repeated since county council approved the taxes Dec. 4.

Onorato said the county's ready to collect the tax. Others say the hospitality industry isn't ready to pay it.

Friends Against Counterproductive Taxation -- a group formed by local restaurateurs -- plans to ask a judge to delay implementation of the drink tax, said Kevin Joyce, owner of The Carlton, Downtown, and board chairman of the Pennsylvania Restaurant Association.

Some businesses also are waiting for more concrete guidelines before resetting their registers, industry watchers said.

County Treasurer John Weinstein said he plans to send out specific details on the new tax by Dec. 21. Payments for January's tax will be due in late February.

"In addition to the rules and regulations, there will be a listing of what's taxable (and) what's not taxable," he said. "My objective is to work with people as best we can."

The lack of guidelines this close to the end of the year can be frustrating, said Mark Gillie, whose Maryland-based company provides registers to more than 260 county restaurants.

"We haven't been able to do anything with it. We're on hold. We're absolutely on the end of our seat," said Gillie, general manager of Micro Systems, Inc. "It's going to impact our ability to make sure our customers are taken care of in a timely manner. ... That's going to be a daunting task."

"Questions have come up like crazy the last few weeks," said Ned Sokoloff, president and CEO of the Specialty Group, a business consulting firm in Ross. "Nobody knows anything about anything. ... It's really a dilemma."

Some are less concerned. Rob Singer, manager of the Dew Drop Inn in Harrison, said his restaurant hasn't prepared for the new tax, but he does not anticipate a problem.

"Our cash registers have two separate tax buttons," Singer said. "It wouldn't take too much to change it over."

Others are focused on political fallout from the drink tax, which Harrisburg legislators created, Onorato backed and County Council enacted. A similar tax is on the books in Philadelphia.

Joyce said Republican legislators -- whom he would not name -- have encouraged him to pin the tax on Onorato, who analysts have called a strong Democratic Party candidate to succeed Gov. Rendell in 2010.

"They wanted to hang two new taxes on Dan Onorato. ... They suggest we call it 'The Onorato Tax,' " Joyce said. "This is the albatross they prepared for him."

"The real issue is they want more options," Onorato said. "This anger? I understand. ... These are the only two options I have."

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