What costs Connecticut more: Liquor sales blue law, or Governor Malloy?

Living as I do, in close proximity to the Connecticut border, I get most of my news from Connecticut. Lately, the topic of the blue law restricting the sale of liquor on Sundays has become a hot topic. And in the interests of full disclosure, I could not possibly care less if people can buy on Sunday or not.

From Malloy you hear the following:

Malloy still wants to allow retail alcohol sales on Sundays, extend hours of operation and allow some convenience stores that sell large quantities of groceries to also sell beer. Malloy has said that his bill would help recapture the approximately $570 million in sales that Connecticut loses each year to cross-border sales.

Likewise, there are some commercials running on local radio stations that indicate that plenty of people will drive up to Massachusetts, or Rhode Island or New York to purchase liquor on Sundays, and do other shopping there since they have gone out of their way to do so anyway.

Sounds great, right?  Connecticut gets to stop bleeding sales and liquor tax revenues, and Connecticut alcohol buyers don’t have to trek out of state to get their booze.

Of course, it couldn’t have anything with Connecticut precipitous alcohol excise tax increase of 20% implemented effective July 1, 2011, which was made retroactive to liquor already on the shelves for maximum return (sound familiar?).  Or the fact that these taxes are passed straight to consumers.  No, not a chance of that!  But I digress.

But let’s cut to the real problem: Malloy doesn’t seem to be able to (or more likely, want to) apply his “they are going to flee across the border to buy things more cheaply” logic to the real 600 pound gorilla in the room: the huge tax on fuel in Connecticut, making the difference in price between Connecticut about 25 cents per gallon for regular at minimum, and about 30 cents per gallon for Diesel depending where you look.  You know that the gas station with a penny per gallon cheaper fuel gets most of the business.  Now multiply that by the difference in fuel tax rates between Massachusetts and Connecticut.

Now seriously, unless you are a real lush, are you going to drive to Mass. to buy your liquor instead of stocking up on Saturday?  Not likely, but you sure as heck more likely to make the trek for a quarter or more a gallon for fuel.  And by my observations of license plates in Southwick, Mass., these same Conn. residents buying fuel in Mass. go right across the street to the Big Y, CVS, Dunkin Donuts, other restaurants and yes, local liquor stores as well.  Like the advertising says: if they are going to be up there anyway, they will do the rest of their shopping there as well.  Makes you wonder what will happen when those MA casinos go online.

How come Malloy doesn’t care about the fuel tax losses to adjacent states?  Could it be that the only Conn. drivers that can take advantage of it live closer to the border, leaving residents of the more southern parts of the state hanging out to dry (or more accurately, bleeding to death by taxes?) and it makes up for the difference?  Surely the losses in fuel taxes and ancillary out of state purchases have to be relatively huge compared to the losses due to out of state liquor sales and far more likely to drive an exodus out of the state.  Do you get the feeling that there is some “behind the scenes” activity in play here?

Maybe Malloy is just showing his compassion by helping Conn. residents get more access to alcohol, after driving them to drink (no pun intended) with what he is doing to the state. Or maybe by pushing fuel prices high enough, he will prevent Conn. residents from being able to flee from his Draconian tax policies…