-- If Doug Petkovic has to charge more for a cold one, running his upscale restaurant in this blue-collar city is going to get even tougher.
But that is what Petkovic will have to do if the Ohio legislature decides to double the beer tax to help ease the state's money crunch.
"Any type of price increase makes it more difficult for people to come here and dine," said Petkovic, who owns Theory, in the up-and-coming Tremont neighborhood. "In my eyes, that sort of taxation amounts to almost persecution."
Not surprisingly, drinkers, brewers and distributors feel the same way. The plan, however, does have supporters: Gov. Bob Taft (R), who proposed it to help balance the $51 billion two-year budget, and those who point to the social and economic costs of alcohol abuse.
More and more states are considering higher alcohol taxes after years of raising cigarette rates.
This year, Kentucky and Washington state increased liquor tariffs. Montana, Indiana and North Dakota rejected higher beer taxes. Texas is still considering an increase, which would help pay for public schools.
And Ohio lawmakers must decide what they are going to do before the new fiscal year starts July 1.
Taft is calling for the excise tax to go from 18 cents to 36 cents a gallon on alcoholic beverages other than liquor, notably beer and wine. The cost of a beer would go up depending on how each manufacturer and retailer passes along the tax. It most cases, it would be pennies.
Overall, the increase would add $50 million to the state's general fund. Ohio received $58.8 million in tax revenue from alcoholic beverages in fiscal 2004.
Kentucky's General Assembly in March approved increasing the wholesale liquor tax from 9 percent to 11 percent, which is expected to raise $8.8 million this fiscal year. Washington state's budget is expected to get $50 million from its $1.33-per-liter tax on hard liquor.
Kentucky's increase -- the first in 50 years -- allowed lawmakers to lower income taxes for the state's poorest families, said Sen. Charlie Borders, the Republican chairman of the budget-writing committee.
"Our tax increase on liquor was minuscule compared to what some people thought it should be," Borders said. "Believe you me, we've had no grief from the liquor industry because they've been treated very well, in my opinion."
Ohio's proposed beer tax increase is part of a broader plan that would eliminate taxes on business equipment and inventory and also lower business income taxes, among other things.
Excise taxes, sometimes called sin taxes, are a more palatable way to raise revenue for states than a broader tax, said Bert Waisanen, fiscal analyst for the Denver-based National Conference of State Legislatures.
Part of the reason is the moral message. The Center for Science in the Public Interest, a Washington-based nonprofit, says that raising alcohol taxes is a good way to fight alcohol abuse.
"Tens of millions of dollars a year already are spent marketing alcoholic beverages to underage consumers," George A. Hacker, director of the center's Alcohol Policies Project, said in a statement posted on the center's Web site. "Lower taxes and lower prices will only further entice young people to drink."
Businesses, however, are warning about the consequences.
Columbus Distributing Co., which handles Anheuser-Busch, may have to cut its workforce if a tax increase translates into a drop in demand, said Paul Jenkins, the company's president.
"It is paid ultimately by the consumer," Jenkins said of a higher tax. "It's just the way the system works."
Sellers are worried, too, especially those near state borders. With the increase, Ohio's beer tax would be well above that in neighboring states.
"It's going to fall hard on the small guys," said George Thompson, owner of D&J Carryout, an independent seller of beer and wine in Toledo. He estimated that beer accounts for 80 percent of his sales.