Posted by: Josh Lehner | December 13, 2012

More Border Tax Effect

The latest Willamette Week has an article on liquor sales along the border since Washington privatized their sales and distribution in June. The article discusses the fact that sales have jumped considerably in recent months and also includes an awfully nice map 🙂

As detailed previously, both in the blog post and the downloadable slides, Washington retail liters sold (+10%) and prices (+15%) have increased as well however some of the sales increase is likely due to the novelty effect of being able to purchase liquor at many more locations and may dissipate somewhat as consumers become accustomed to the new environment.

One additional, interesting piece of information I learned last week at a presentation I gave is that in Rainier there is a tobacco store next to the liquor store and both have seen big gains in sales and/or have large customer bases. As mentioned previously the tax difference per pack of cigarettes between Washington and Oregon is currently $1.85 which is the largest tax differential between the states going back to the early 1980s. Rainier may have a population of just about 1,900, however it is directly across the river from the cities of both Kelso and Longview in Washington which have a combined population of 48,573, providing a much larger potential customer base. Both anecdotal information and the underlying sales data indicate that at least a sizable share of these Washingtonians make purchases in Oregon.


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