LINCOLN, Neb. (AP) — Nebraska lawmakers gave first-round approval Thursday to a measure that would undo a state Supreme Court decision to tax Mike's Hard Lemonade and other so-called "alcopops" at the same rate as hard liquor.
The Nebraska Supreme Court ruled last week that sweetened malt beverages should be taxed as hard liquor instead of beer. Beer is taxed at 31 cents per gallon in Nebraska, while liquor is taxed at $3.75 per gallon.
That large tax jump had citizens and lawmakers buzzing, and the Legislature debated more than 2½ half hours on the issue Thursday.
Lawmakers voted 27-7 to advance a bill defining "alcopops" as beer, keeping the tax where it is now. It still faces two more rounds of debate.
"I know this strikes an emotional chord," said bill sponsor Sen. Russ Karpisek of Wilber. "I know we have a problem with underage drinking. But not all of these flavored malt beverages are even the same alcohol content as beer. Some are lower.
"It is the Legislature's role, along with the governor, to set tax policy. I do not believe we should raise these taxes."
Critics said the beverages are aimed at young customers because of their sweet taste and should be taxed at the higher rate.
Sen. John Harms of Scottsbluff said more and more young Nebraskans are drawn into alcohol use by fruity drinks, and alcohol manufacturers know that beer consumption is down.
"It's about greed," he said. "It's about grabbing a share of the market. I think we need the higher price. The higher it is, the less people will purchase it."
Sen. Mark Christensen of Imperial said "alcopops" open the door to more youth alcohol problems.
"When you look at it, people say this is a gateway drug. If you have a very sweet and flavorful drink, it makes it easier to start drinking."
Karpisek and other supporters said the higher tax would not affect underage drinking.
"These flavored malt beverages have been classified by some as the worst thing because they are targeted to teens," he said. "Federal investigations show that they are not."
Copyright 2012 The Associated Press.