HARRISBURG, Pa. (WHTM) – The Distilled Spirits Council of the United States and the American Distilled Spirits Alliance sent a letter Monday to Pennsylvania Liquor Control Board Chairman Tim Holden urging the agency to reconsider planned price hikes scheduled to take effect in August 2020.
“In light of the severe disruption in spirits sales caused by the continued closure of all Pennsylvania state stores, we urge you to suspend all scheduled PLCB initiated price adjustments scheduled to go into effect in August 2020,” DISCUS President and CEO Chris Swonger and ADSA President Matt Dogali stated in the letter. “In our view, there couldn’t be a worse time to raise prices on Pennsylvania consumers. Store closures during the COVID-19 outbreak resulted in a significant drop in state tax revenue from lost spirits sales, approximately $16 million per week. It would be incredibly misguided to increase prices on spirits products now to make up for that shortfall.”
“Flexible pricing gives the PLCB complete authority to increase prices on Pennsylvania consumers without any checks from the people’s representatives,” said House Representative Jesse Topper (R-Bedford). “Now, the agency wants to increase prices on top of store closures and the negative impacts of COVID-19. The current crisis has only exacerbated the problems caused by flexible pricing, and the need for repeal is only more prevalent.”
Rep. Topper is the sponsor of HB 1512, which would repeal the PLCB’S flexible pricing authority.
“We have raised concerns repeatedly that the PLCB’s unchecked flexible pricing authority has led to price increases that have negatively impacted Pennsylvania consumers,” Swonger and Dogali added. “Price increases combined with closed stores is not a business model for future success…We are hopeful the PLCB’s pricing standards and policies will take into account the hardship that many in the hospitality industry are currently facing because of this crisis and could continue to face for months to come.”
A notice of the price increases was sent to spirits suppliers in March 2020. The letter from Distilled Spirits Council of the United States and the American Distilled Spirits Alliance was sent on Monday, April 13.