Mass. Residents Vote to Abolish Alcohol Sales Tax

In a close vote, Massachusetts voters decided Tuesday to repeal the 6.25 percent tax on alcohol and restore the sales tax exemption liquor enjoyed until last year. Package store owners near the New Hampshire border argued that the tax had resulted in the loss of business to the tax-free Granite State.

Many in the liquor industry, which raised more than $2.5 million for the repeal effort, also noted that alcohol was already subject to an excise tax.

“The voters supported Question One because it’s unfair to double tax one product and because it was putting too many local businesses at a competitive disadvantage,” said P.J. Foster, a spokeswoman for the Yes on One Committee, in a statement.

However, repeal opponents said alcohol wasn’t deserving of a sales tax exemption and warned that repealing the tax would result in the loss of more than $100 million in state revenue, much of which is earmarked for community-based alcohol treatment programs. Proponents of the repeal promised to work to maintain funding for substance abuse services, but it may be difficult to do so.