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Tax on beer may help cover health insurance

WASHINGTON — Joe Six-Pack may have to hand over nearly $2 more for a case of beer to help provide health insurance for all.

Details of the proposed beer tax are described in a Senate Finance Committee document distributed to lawmakers before a closed-door meeting Wednesday. Senators are focusing on how to pay for expanding health insurance for an estimated 50 million uninsured Americans, a cost that could range to some $1.5 trillion over 10 years.

You can't raise that from beer money alone.

Lawmakers are looking at an extensive list of spending cuts and tax increases, including a new levy on the value of job-based health insurance. The latter proposal seems to be gaining ground. It could lead to higher income taxes for some people with particularly generous job-based health care.

Finance Committee Chairman Max Baucus, D-Mont., said no decisions were made, but he will use the feedback to shape legislation he intends to introduce in the next few weeks.

The committee has a critical role to play in the health care overhaul, since it writes tax law and oversees the government's giant medical insurance programs. Baucus wants to write a bipartisan bill, a goal for President Barack Obama.

"Nothing's pushed off the table," Baucus told reporters after the daylong meeting. He said senators have come closer on some issues, but much remains to be resolved.

While many of the revenue raisers involve obscure provisions of federal law, most consumers can relate to a beer tax.

Taxes on wine and hard liquor would also go up.

And there might be a new tax on soda and other sugary drinks blamed for contributing to obesity. A tax of 3 cents per 12-ounce drink would raise about $50 billion over 10 years, according to congressional estimates. Diet drinks, however, wouldn't be taxed.

The idea behind the proposed increases is to tax lifestyle choices that contribute to rising medical costs. Obesity puts people at risk for diabetes and heart problems. Alcohol abuse is a risk factor in several types of cancer, liver disease and psychological problems.

The soft drink industry and beer and wine producers are already lobbying to stop the proposals before they gain traction. The tax increases would lead to job losses for workers and higher costs for recession weary consumers, say the industries.

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