Last year California decided to raise taxes on “alcopops,” sweet alcoholic drinks that are largely designed to appeal to teenagers. But guess what? No new taxes have flowed into state coffers:
Beverage makers admit they aren’t paying the new taxes. They say they don’t have to because they have reformulated the drinks — more than 6,000 varieties — to transform them into simple beers by limiting the amount of distilled spirits they contain.
They won’t explain how. The formulas, they say, are trade secrets. And beverage-industry officials and federal regulators say there are no tests to determine how much distilled spirits the drinks contain.
….Board member Bill Leonard, who voted against the initial tax hike, said that although he is curious about how the industry managed to change thousands of drink formulas in a year, “it is probably impossible for us to ever figure out whether the formula is what they say it is.”
I have to admit that my first reaction when I read this story was to laugh. I know, I know: that’s totally inappropriate. It’s a serious issue. Etc. But the brazenness on display here is really something, isn’t it? If the alcopop business ever fizzles out, maybe industry executives can all find jobs at AIG instead.