Lawsuit: Iowa illegally marked up liquor prices for years

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CyclonePigskin

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I have a cousin in Crystal Lake, IL who bought a boat last summer from a private individual. He got a call from the state this spring.....they were disputing the amount he paid for the boat! (Apparently the value determines the amount of tax paid.)

They were demanding he prove the amount. I've also heard Illinois is considering an extra tax on people who are selling their homes to move out of state.

The lesson to be learned from this is that inefficient government leads to taxpayers getting gouged. Bend over, baby.

A big time Des Moines real estate developer was recently charged with six counts of fraud for doing just that on six cars he purchased over a few years.

The lesson to be learned is don’t cheat on your taxes.
 
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SEIOWA CLONE

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The only Rum I like is the stuff I brought back from Dominican Republic. I even went to a local liquor store to see if they could get it for me but they said they couldn't.

Give the Blue Chair rum a try, its pretty good, around $18.00 a bottle.

Living close to Missouri, I make a chew run once a month and purchase all of tailgating beer in Missouri. I can purchase a log of skoal for $20.00, here in town its $6.00 a can. Well worth the 15 minute drive.
 

CycloneDaddy

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If you like cheap liquor I would recommend stocking up as the State is suppose to be increasing the price on cheape booze July 1 to create a floor price that will probably be passed onto the consumer.
 

BillBrasky4Cy

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If you like cheap liquor I would recommend stocking up as the State is suppose to be increasing the price on cheape booze July 1 to create a floor price that will probably be passed onto the consumer.

Whats driving the price increase?
 

GT25Ump

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If you like cheap liquor I would recommend stocking up as the State is suppose to be increasing the price on cheape booze July 1 to create a floor price that will probably be passed onto the consumer.

Is there a story somewhere on that, as this could affect the drinking habits of those that partake daily in drinking cheap, low quality booze. Asking for a friend. :)
 
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ArgentCy

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If you like cheap liquor I would recommend stocking up as the State is suppose to be increasing the price on cheape booze July 1 to create a floor price that will probably be passed onto the consumer.

So they cheated everyone for years and instead of the price going back down they are doubling down. Seems about right for these *$&%.
 

BillBrasky4Cy

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No ****. We already have crazy high booze prices compared to surrounding states.

That's because there are no deal structures and the state is making 35 points per case.... a legit distributor would be lucky to make 20%.
 

thatguy

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As someone that has worked nationally in and around the booze industry for over 10 years, Iowa's problem is that Hy-Vee has a large percentage of the market share and takes plenty of margin on large brands. This past year they went hard into private labels and they didn't go well and they lost their ass. Competition would bring the price down on stuff dramatically.

And yes the floor price on booze is to keep the poor people from drinking as much. Crime decreases when alcohol prices increase. Take that any way you want it. Also lotto is a player here as low income typically play the lotto, and also have to budget.

My favorite is when weed goes legal in States, and watching the chain buyers freak out at their sales. As people budget, and there is more competition for extra money, the chain stores get less.
 

BillBrasky4Cy

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As someone that has worked nationally in and around the booze industry for over 10 years, Iowa's problem is that Hy-Vee has a large percentage of the market share and takes plenty of margin on large brands. This past year they went hard into private labels and they didn't go well and they lost their ass. Competition would bring the price down on stuff dramatically.

And yes the floor price on booze is to keep the poor people from drinking as much. Crime decreases when alcohol prices increase. Take that any way you want it. Also lotto is a player here as low income typically play the lotto, and also have to budget.

My favorite is when weed goes legal in States, and watching the chain buyers freak out at their sales. As people budget, and there is more competition for extra money, the chain stores get less.

No, Iowa's problem is that the IABD sells everything at a case one price at 35% margin. The only discounts available are provided by the suppliers in the form of a marketing fund check and those quantity deals have to be approved by the state and offered to everyone. A HyVee in Iowa is probably making less per bottle than a HyVee in MN or MO.
 

thatguy

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No, Iowa's problem is that the IABD sells everything at a case one price at 35% margin. The only discounts available are provided by the suppliers in the form of a marketing fund check and those quantity deals have to be approved by the state and offered to everyone. A HyVee in Iowa is probably making less per bottle than a HyVee in MN or MO.

Trust me, I'm very versed on the laws. Ohio, Tennessee and Kentucky have higher tax rates then Iowa and also have retail minimum price laws. Hy-Vee uses its buying power and State monopoly to make sure they get their margin, while also getting through the State tax system. So if you can't give them huge deals (usually only the big companies can because of scalability) on pricing, you don't get shelf space, while Hy-Vee keeps its margins. Those other States have large chains, but they don't dominate the market like Hy-Vee does in Iowa, so there is more competition.

SGWS and JoBo get more than 20% too. Its the suppliers that take the hit.
 
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BillBrasky4Cy

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Trust me, I'm very versed on the laws. Ohio, Tennessee and Kentucky have higher tax rates then Iowa and also have retail minimum price laws. Hy-Vee uses its buying power and State monopoly to make sure they get their margin, while also getting through the State tax system. So if you can't give them huge deals (usually only the big companies can because of scalability) on pricing, you don't get shelf space, while Hy-Vee keeps its margins. Those other States have large chains, but they don't dominate the market like Hy-Vee does in Iowa, so there is more competition.

SGWS and JoBo get more than 20% too. Its the suppliers that take the hit.

I worked in the business too.... LOL the suppliers aren't taking the hit, SGWS and J-Bro drop their pants to hit numbers for the big suppliers. Either way, neither SGWS or J-Bro are making 35 points on a bottle of Absolut Vodka....
 

thatguy

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I worked in the business too.... LOL the suppliers aren't taking the hit, SGWS and J-Bro drop their pants to hit numbers for the big suppliers. Either way, neither SGWS or J-Bro are making 35 points on a bottle of Absolut Vodka....

Nobody is making 35 points on Vodka except for the State here, which i agree with you on. However, in States with similar tax brackets, prices are lower because of more competition. AS SOMEONE THAT IS A NSD FOR A NATIONAL BRANDS I can promise you suppliers take plenty of hits, but because of economies of scale it is doable. More you produce, the more raw goods you buy, the more room you have to move on pricing because costs of goods has gone down. Hy-Vee and JoBro and SGWS are good companies that I like dealing with, but none of them are going broke in Iowa. The way the entire system is set up, if you go below 18% you lose money after overhead and taxes.