A state lawmaker wants to reduce the tax on liquor, wine and heavy beer for small breweries and distilleries.

Sen. Minority Leader Mike Dmitrich, D-Price, is sponsoring a bill that would significantly reduce the markup on alcoholic drinks produced by small companies and sold in liquor stores.

The price of alcohol sold in the State Liquor Store is 86 percent more than the state pays for it. Dmitrich's bill would reduce that markup to 47 percent for liquor and wine. It would drop to 30 percent for heavy beer.

Last year the state collected $53 million in liquor profits.

Dmitrich, who said he has not yet seen a copy of the bill, is sponsoring the bill at the request of lobbyist and former state legislator Steve Barth.

"It's an economic development bill," Barth said. "It will help in-state business."

However, the bill does not limit where the alcohol must be produced, and the discounted markup would be available to brewers nationwide.

Instead, taxes are based on the number of gallons a brewery or distillery produces.

Utah has several small breweries, and now has High West Distillery in Park City. Barth is a registered lobbyist for High West and Utah Brewers Co-op.

If the bill passes, consumers could pay less for spirits produced by local companies when buying alcohol at the liquor store because the state markup would be lower on those than on large chains' products.

The bill would not affect alcohol prices from any brewery for beer at the grocery store.

The bill calls for continuing to send 10 percent of gross sales from the liquor store going to fund the school lunch program.

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On the Web

le.utah.gov/2-2008/bills/sbillint/sb0095.htm