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Washington State’s Small Retailers Seek Redress Against Pricing Pressure By Big Chains

December 16, 2013

Washington state lawmakers are exploring potential remedies to the rising outrage of small, independent spirits retailers who are being squeezed out of the newly privatized market by larger chain operators, according to Washington State Wire.

When Washington auctioned its 167 state-owned liquor stores in 2012—reaping a windfall of $31 million—many of the buyers were mom-and-pop operations hoping to get in on the ground floor of the newly open market. But the State Liquor Control Board reports that only 97 of those stores are still paying taxes, and liquor-store owners assert that few if any are turning a profit, with their prices being pressured downward by large-scale retailers like Costco and Safeway.

Some small-store operators are requesting a carve-out from the state’s 17% retail tax on spirits, but some in the state legislature are resisting that idea, citing tax discrimination and lost revenue. Another measure under consideration is a refund of the auction price to small players that would allow their remaining inventory to be sold to other stores without additional taxes. As of now, it’s unclear whether either proposal has the votes to pass.

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