On Nov. 2, voters in Massachusetts cast a majority of ballots in favor of restoring the sales tax exemption for beer, wine and alcohol.
Thus, on Jan. 1, 2011, the 6.25 percent sales tax on those items that has been in effect since August 1, 2009, literally disappears, and the sale of beer, wine and alcohol sold in markets or package stores returns to tax exempt status.
DOR has issued a Technical Information Release on the repeal of the alcohol sales tax. The TIR reminds taxpayers and business owners that the state and local option meals tax, which include sales tax on drinks sold in bars and restaurants, remains in effect.
The sales tax on alcohol is estimated to have generated about $97 million in FY10 and, had it been effect for the entirety of FY11, about $110 million. DOR estimates the elimination of the tax will produce a FY11 collection diminished by about $46 million.
Not surprisingly, package store owners, who strongly backed the repeal, are in a celebratory mood about ringing in a new year without the alcohol sales tax. Today's Boston Herald reports that owners will be toasting the repeal with a symbolic dumping of alcohol into Boston Harbor next week.
If consumers find a sales tax on their package store purchase of beer, wine or alcohol as of Jan. 1, they should call DOR customer service at 1-800-392-6089 to report if they are unable to obtain a refund at the store.