Bar owners and restaurateurs in Allegheny County bought less alcohol from the state during the first month of the 10-percent drink tax, according to figures released this week.
The state sold $3.74 million of alcohol to liquor license holders in the county in January, a nearly 3.5-percent drop from $3.87 million in January 2007, said Francesca Chapman, a Liquor Control Board spokeswoman. At the same time, sales to license holders statewide climbed about 4 percent, from $28.54 million to $29.69 million.
Chapman cautioned against reading too much into the numbers.
"I'd be reluctant to jump to any conclusions," she said. "I think there's a lot of factors in play."
But opponents of the tax, which is meant to support public transit, say it shows business is down because of the surcharge.
"There's no doubt that an increased tax on alcohol will drive down sales," said Sarah Longwell, a spokeswoman for the American Beverage Institute, which opposed the tax. "Everybody's getting hurt here, except the politicians who created the problem in the first place."
"This is exactly what economic theory tells us will happen. You put in a tax ... and you would certainly expect business to decline," said David Ozgo, chief economist with the Distilled Spirits Council in Washington, D.C.
John Graf isn't surprised to hear alcohol sales are down in the county. The owner of The Priory in the North Side said weddings, which he called "pretty much recession-proof," and banquets are lagging.
"We're probably down 25 percent in bookings this time this year versus last year," he said.
The numbers are not audited, and they represent only sales to county license holders, not to out-of-county businesses that buy alcohol in the Pittsburgh area, she said.
John Valentine, owner of Palate Bistro, Downtown, said it's hard to tell if the drink tax is driving down sales.
"You have to look at a lot of factors," he said. "I don't want to say 'It's due to the drink tax.' I don't think that's fair."
Ozgo called the state figures a good gauge for liquor sales.
Although sales are down, tax revenue has been stronger than expected, county Treasurer John K. Weinstein said.
About 1,630 license holders paid about $2.64 million in drink tax revenues for January, he said. The roughly 400 active license holders who did not file taxes should be ready for a phone call or a visit this week from county officials.
"Believe me, the pressure will be on them to comply," Weinstein said. "In Philadelphia, they don't go after neighborhood bars (but) enforcement (here) is going to be strong."
The county expects to raise $28 million this year from the drink tax to help pay for public transit, but is on pace to collect more than that, officials have said. County Chief Executive Dan Onorato and others say they are lobbying legislators in Harrisburg for alternatives to the drink tax and a $2-a-day rental car tax that's projected to raise another $4 million.
Beer distributors, whose sales are exempt from the tax, said they haven't seen a surge in customers fleeing bars for take-home beverages.
"It's been about the same for us," said Liam McGuire, assistant manager at Banksville Beer. "If I were going to spend $50 (at a bar), I wouldn't hesitate to spend $55."
"Speaking to people in the industry, I really haven't heard that they're off," said Steve Klein, who owns Save-Mor Beer & Pop Warehouse in Squirrel Hill.
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