Delaware revenue plan stalls in Legislature

A House bill to raise alcohol license fees for businesses such as restaurants and bars failed on Thursday to win the required three-fifths majority in the Senate, prompting senators to adjourn without taking up a related bill raising the excise tax on alcoholic beverages by 50 percent.

"Obviously we didn't think the votes were there ... You don't need to be a rocket scientist to figure out the rest," said Sen. Nancy Cook, D-Kenton, co-chair of the Joint Finance Committee.

Jay Hibbard, vice president of the Distilled Spirits Council of the United States, issued a prepared statement praising the Senate vote.

"As restaurants and retailers throughout the state continue to struggle through this economic downturn, now is absolutely not the time to hit these businesses with higher license fees or an outrageous 50 percent tax hike," he said.

The trade group has a dozen members, including Diageo PLC and Brown-Forman Corp.

In an earlier Senate vote, lawmakers initially rejected a House bill to increase the gross receipts tax rate by 2.5 percent for supermarkets and roughly 25 percent for other businesses. The measure failed on the first roll but was brought back for reconsideration and passed by one vote.

Sen. Gary Simpson, R-Milford, said he switched his vote on the gross receipts bill from no to yes because he didn't want to "put the whole budget situation in chaos."

"I wanted to vote no on all these tax increases because I don't think we've done enough cutting," he said.

Meanwhile, a proposed 1.9 percent provider tax on hospitals remains in limbo, with hospital administrators maintaining their opposition despite assurances that the tax would be offset with higher Medicaid reimbursements.