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Business owners oppose city drink tax

| Friday, Jan. 24, 2003, 12:00 p.m.

Bar and restaurant owners promised Thursday to fight Mayor Tom Murphy's proposed 10 percent drink tax and half-percent payroll tax.

Murphy has proposed the new taxes to help balance the city's 2003 budget.

Bar and restaurant owners, at a meeting hosted by the South Side Chamber of Commerce, complained the weak economy already has cut into their business. They said they should be the last — not the first — recourse to help bail out the city. Some argued the drink tax would cause customers to flee to places outside the city, such as Green Tree or Homestead.

About 60 people attended the meeting at the South Side's Sokol Club. The business owners haven't yet finalized their plan to oppose the taxes, which need approval by the Legislature.

"This would strangle our industry," said Kevin Joyce, who runs the Carlton Restaurant in One Mellon Bank Center. "It'll put a lot of restaurants out of business."

Revenue from the proposed taxes are included in the city's 2003 operating budget. The budget, approved by city council, includes $24 million from a 0.5 percent payroll tax and $5 million from the drink tax. Murphy needs to have the taxes in place by July 1 to keep the city's budget balanced.

The taxes are part of a larger plan that would be good for bars and restaurants, said Craig Kwiecinski, spokesman for Murphy.

In exchange for the drink and payroll taxes, Murphy would reduce so-called nuisance taxes — real estate, business privilege, and mercantile taxes — in 2004, Kwiecinski said.

"The mayor's plan will help to bring about fairness to our tax structure," he said. "The mayor's plan will help to create a level playing field."

Also opposed to the taxes are state Sen. Jack Wagner, a Beechview Democrat; city Controller Tom Flaherty; state Rep. Harry Readshaw, a Carrick Democrat; and city Councilman Alan Hertzberg.

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