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Wine and Grocers

Paper or plastic, Bordeaux or rosé? Two states, Tennessee and New York, currently have active bills aimed at permitting grocery stores to sell wine. Proponents of the bills argue the change will generate jobs and create new tax revenue by expanding the consumer base. Opponents argue that liquor stores in the states, which are small and locally owned by law, will suffer steep losses in revenue and possibly face layoffs. In Tennessee, it appears that the bill’s opponents have been more persuasive to date, with a vote on the measure postponed until the summer of 2012. The New York Bill has bipartisan support and is possibly up for a vote before the legislative session ends in late June. Similar bills have been defeated in New York by the liquor store lobby in the past. As a preemptive measure, the new bill includes incentives for liquor stores, including the right to own more than one store. Even the title of the bill, “the wine industry and liquor store development act” reflects the hope that the liquor store lobby can be appeased. Given the fiscal climate, one factor that may garner additional emboldened supporters this time around is the “changeover” fees potentially generated by the measure: $346.7 million in new revenue in the first year through franchise and license fees, excise taxes and sales taxes.

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