Wine Goddess wants liquor tax break

Diana Hamann, owner of the recently opened Wine Goddess shop in Evanston, wants the city to drop its 6 percent tax on retail liquor sales.

Hamann told the city's Liquor Control Board today that the tax is unfair because other nearby communities -- including Skokie and Chicago -- don't impose such a tax.

Hamann said the problem is especially severe when Wine Goddess customers are considering buying a large quanity of wine for a wedding or other event.

"If somebody's going to spend $1,000 on three cases of wine, why wouldn't you drive the five miles to Binny's or Schaefer's?" Hamann said. "In their mind that merits the trip across the border to Chicago or Skokie."

Hamann, who's been running her shop for about three months, said, "I'm trying to think how I'm going to make this thing a viable Evanston presence for the long haul, and I'm never going to stay in business with just the guy who buys one or two bottles at a time."

But Mayor Elizabeth Tisdahl, the city's liquor commissioner, said the city counts on the $2 million in revenue the liquor tax brings in.

"I don't want you to go out of business, and would like to help," the mayor said, "but the reality here is that you're asking us to fire a couple of people or raise [property] taxes and force more people out of their homes."

She noted that the city has already cut more than 10 percent of its staff in recent years because of tight financial times.

This year's city budget projects an increase in liquor tax revenue from $2.07 million to $2.35 million as a result of the anticipated opening of Trader Joe's and the start of liquor sales at Whole Foods.

Ted Mavrakis,  who was at the meeting to seek expanded hours for his World of Beer franchise downtown,  seconded Hamann's concerns.

"I'm with you," Mavrakis said, adding that the owner of a liquor store on Dempster Street in Skokie has told him that he gets a lot of extra business because of Evanston's liquor tax, and because of Evanston rules that bar the sale of small bottles of liquor.

At his own establishment, Mavrakis said, he tries to hide the impact of the liquor tax by building it into the advertised price of his beers, rather than adding it as a separate item on the bill.

City attorney Grant Farrar said Evanston isnt' the only community with a liquor tax -- but Hamann said the only such tax in the immediate area is a 1 percent tax imposed by Wilmette.

Tisdahl said she's willing to raise the issue with the city's Economic Development Committee, but she didn't sound encouraging about the prospects of the City Council agreeing to such a change.

As the meeting was breaking up, liquor board member Dick Peach offered Hamann another suggestion.

"What you need to do," Peach said, "is open a wholesale warehouse in Skokie, while keeping your retail store in Evanston."

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Comments

Hello Skokie

I was not aware of this tax.  Does it show up as an individual item on the grocery bill (e.g. 6% Evanston liquor tax or is it hidden in one of the two or three different taxes on the grocery bill?)
And I thought I was an informed citizen! 

Evanston is plain

Evanston is plain anti-business. Period. 

I love the Wine Goddess, but...come on!

Diana is awesome and I actually stopped buying wine from Binny's in Skokie because she knows her stuff and gives great customer service.
That said, asking the city to do away with the booze tax is a bit of a pipe dream.  The tax has been around for years so it seems weird that she would open up her shop and then three months later start thinking about the tax.
I am more of a "one or two bottle a time type of guy," BUT if I were going to have a party where I needed $1000 worth of wine I would likely choose the Wine Goddess because she provides such great customer service.  If you build up a loyal enough following, your customers are not going to think twice about saving $60 when they are paying $1000.
I have bought booze weekly for years, sometimes in Evanston and sometimes in Skokie and have never thought about the tax.  For me it is about selection, convenience, and expertise (with regard to wine) that mean more than anything else.  I suspect the same is true for most booze afficionados. 

Some may, some may not

"If you build up a loyal enough following, your customers are not going to think twice about saving $60 when they are paying $1000."
Some customers may, some may not.  I could definetly see customers that are spending $1,000 on wine (quite a bit of money)... and presumably lots of money on other party related items... attempt to find ways to slash $50 here or $100 there on items.

Liquor tax break

Isn't this a bit like buying a house near O'Hare and only then complaining about the noise?

Open in Skokie then

Presumably, Ms. Hamann knew about the tax before opening her business....which begs the question of why she didn't open it in Skokie.

Even Evanston needs a Goddess

Perhaps Ms. Hamann is actually one of 'those people' who would prefer to stay in her own town and start a local business that benefits her community, not someone elses.
Maybe you could enlighten all of us with what the problem is with trying to improve the small business community in Evanston while staying competitive with neighboring communities? And what is so terribly wrong with asking for something? It never hurts to ask. Ever.

We don't usually buy wine in

We don't usually buy wine in Evanston. We shop at Binny's in Skokie/Niles because Evanston seeks too much of residents' money in many, many other ways: parking violations, speed traps, more water/sewer taxes, etc., etc.

Lots of hidden taxes

The liquor tax applies to retail and restaurants.  Buy a beer while having dinner, pay 6% on top of the already 9.5% sales tax for a 15.5% total rate. 
This is not to mention the state excise taxes retailers must pay when they receive inventory, motor fuel taxes from the delivery of inventory, etc. etc. all which obviously gets passed directly to the consumer as does the very high license fees charged to the retailers for the right to sell liquor.  End result is probably somewhere around 18 to 20% in added on additional cost to the consumer. 
15.5%, plus the add on taxes and license fees makes Evanston possibly one of the highest liquor, general sales tax rates in the whole country.  Even in high tourist areas that routinely soak their visitors, like Orlando Florida,  the tax rates are lower.  Ridiculous.

Wine tax

The 6% tax applies not only to restaurants, but also to sales at the grocery stores. At the Jewel-Osco on Howard Street in Evanston, for example, I have a receipt showing $1.74 in taxes paid on a $28.94 wine purchase, a rate of 6% (28.97 x .06 = $1.7364, and that gets rounded up to $1.74). It's an old receipt, as I don't buy wine in Evanston any longer, but the 6% tax is assessed to this day. (Drink up, NU students.)

Evanston - the land of tax zombies

Evanston is a taxman's paradise.
I bet you didn't know that two years ago Evanston created a new 2 cents gas tax.
Evanston has a demolition tax so every time a developer tears down a property to build a new one they must pay the city $10,000 and it goes into the city's affordable housing fund. Someone is suing the city claiming the demolition tax harmed the value of their property and a judge ruled it did. Some believe we have enough money for affordable housing given that the feds gave Evanston an $18 million neighborhood rehabilitation grant.
Then we have the largest liquor tax around - 6 cents!!!
Meanwhile, aldermen have raised our taxes twice the inflation rate since 2009 as property values plunged.  The city's pension debt is nearly the same amount as the entire budget and the debt is growing exponentially. But no matter, aldermen in 2010 decided to spend $1 million to start a new 311 call center and hire 20 additional government union employees who are enrolled in the city's pension system. Aldermen love it because they get less calls from their low-informed constituents.
Consider that Cook County has a 9 percent sales tax, one of the highest in the nation, and Illinois raised the income tax 67 percent in 2010. So yes, one could say Evanstonians are overtaxed and underserved. Not one aldermanic candidate this year ran on a platform to lower taxes or streamline local government.
About 20 years ago a group of outraged Evanstonians formed a tax coalition to lower taxes. This group successfully passed a referendum that reduced the number of aldermen by half.  But there doesn't seem to be that sense of outrage or motivation to reduce taxes in this generation. There doesn't seem to be a strong sense of wanting to consolidate our two school districts or privatize some of our government services. It's as if Evanston is a city of low-information tax zombies, we feed on the need to pay more taxes in the name of social justice and a government-knows-best attitude .
Ironically, the people hurt by the city's high taxation are the low income folks. One could argue that if you want to gentrify an area keep the taxes and cost of living high. The city's demographics in the last two decades show it.
Happy taxing, my fellow zombies!!!!!

The perfect solution

The perfect solution is to live in Rogers Park or Skokie or Wilmette.  You can take part of all the wonderful affordable parts of Evanston which are many but not pay the high taxes for homes, liquor, etc.

why are you critiquing the goddess?

The Wine Goddess is a business owner in our town making a valid case (which many of the commentators say they are sympathtic to) to reduce taxes.  She is not arguing for a tax break for HERSELF or HER BUSINESS only (like is complained about here on Evanston Now all the time).  Instead, she is properly raising this issue for EVERY resident who wants to shop in Evanston and all the businesses.  THis is her right (obviously) and something I would expect readers here to be sympathetic to.  
This is the political process to make changes.  If you want lower taxes, support her so she can use her position (Evanston business owner) to advocate for the policy position you favor.

WG

I think people are critiquing because the business just opened. It would be different if Wine Goddess had been around for even a few years and then city council enacted or raised a tax, prompting her to protest. If the tax is a burden to her or her customers,
it's reasonable to wonder why she opened here at all. Doesn't seem like good business sense. I get that she lives in Evanston and probably opened here due to feeling like she wanted to contribute to the community, work where she lives, etc. She still just doesn't make the most credible of protesters due to how new her business is. 
 

Luxury taxes are good.

Shift the tax burden to non-essentials.  Nobody needs liquor, so nobody's suffering due to a liquor tax.
People who will avoid a 6% tax by driving to another municipality will also avoid retail markup (probably at least 25%) by buying online.  

Luxury taxes are dumb

I remember the last time the "lets make the rich pay their fair share of tax" scheme backfired when Jimmy Carter was president.  He enacted the luxury tax on products some deemed as unnecessary or luxury. 
End result, not much tax was collected, and business that  produced the things that were classified as luxury items ended up laying off huge chunks of their time card punching workforce because of lower sales.
So called Luxury taxes do not have the intended consequences and they do cause suffering, not to the luxury consumer mind you, but to those that produce, transport, distribute, sell, maintain, etc, etc, all the items that some yahoo deems luxury.  Really, luxury taxes are kinda dumb.

Taxes = bad

Wrong:  taxes are bad.
Less goverment is good.

People have choices where to purchase

I don't know what extra taxes Chicago, Skokie, Wilmette and perhaps other surrounding towns [or even more distant towns where Evanstonians work] levy but if Evanston does have higher taxes on goods for at least the three surrounding towns---well residents will take advantage.
Some may recall until some time in the 1970's, Evanston had an extra tax on gasoline.  Obviosouly if you need gasoline you have a car---so residents went to Skokie, Wilmette and yes even Chicago.  Finally the city realized what was obvious to residents and did away with the surcharge. 
Cook County realized their lost business when they imposed a jump in the sales tax---probably too late because shoppers had discovered where better prices were and stuck with those stores.
I'd assume Evanston residents have become dumber and still look for the best bargains. I'd never heard of the Wine Goddess nor seen their vans in Evanston.  Schaefer's vans seem to dominate in Evanston and not just for NU but even the well-to-do residential spots.
If the Council does not realize we do not live in a bubble and that shoppers go for value and service.  For liquors and gasoline and many other things the quality does not differ.  For most things residents will go for value [cost savings] in almost any state of the economic.  By scaring businesses out of the city and then higher taxes---well it does not take a genius to realize the effect on the local economy.

I live in SE Evanston

I live in SE Evanston and usually purchase wine at Taste on the Rogers Park side of the border. The tax is definitely one of the factors.