Partial Repeal of Minimum Markup Law Introduced

Huzzah, huzzah.

[Madison, Wisc…] On Tuesday, Sens. Vukmir and Craig and Reps. Ott and Murphy introduced a bill to repeal portions of Wisconsin’s antiquated Unfair Sales Act. Also known as the minimum markup law, the Unfair Sales Act mandates higher prices and outlaws the sale of retail goods at below cost.

The minimum markup law requires that alcohol, tobacco, and motor fuel are marked up 3 percent at the wholesale level, 6 percent at the retail level for alcohol and tobacco, and 9.18 percent at the retail level for motor fuel. It also forbids retailers from selling most other products below cost.

The Unfair Sales Act is a depression era relic of big government protecting the profits of businesses by limiting competition. The whole thing should be tossed into the dust bin. This is not the first time a bill to repeal some or all of it has been introduced and every attempt has failed. Why? Because there are a lot of Wisconsin businesses who like the law because it guarantees them a minimum level of profit and prevents their competitors from beating them on price. Who loses? Consumers who pay unnecessarily inflated prices.

This time it looks like Vukmir and Ott have limited the repeal to only cover alcohol, tobacco, and fuel. I assume this is an attempt to reduce the amount of opposition to the bill from the retail business lobby. Unfortunately, I don’t think it will work. Those same lobbyists will fight this bill because it would open up a crack in the law that could be expanded in subsequent sessions.

I completely support this bill and encourage my representatives to do the same.

4 Responses to Partial Repeal of Minimum Markup Law Introduced

  1. billphoto says:

    I was told at a distillery in Kentucky that the tax on bourbon is 65%.  As it was explained to me:

    There is a Federal Excise tax, State tax and sales tax when you buy the product.  Add to that one has to earn the money – which is taxed – to pay for the product.  That’s taxes on taxes FOUR TIMES.  Add minimum markup (effectively a tax) and that makes it five.

    It appears Wisconsin’s minimum markup adds its’ additional cost after the Federal and State excise taxes so taxpayers cost out-of-pocket is actually magnified by this terrible law.  I believe tobacco and motor fuel taxes are similar.

    I applaud Lea and Jim and all who join them in trying to serve their constituents instead of the special interest.  http://www.bootsandsabers.com/wp-content/plugins/wp-monalisa/icons/wpml_good.gifhttp://www.bootsandsabers.com/wp-content/plugins/wp-monalisa/icons/wpml_good.gifhttp://www.bootsandsabers.com/wp-content/plugins/wp-monalisa/icons/wpml_good.gif

  2. insagtman says:

    This article has the legislation backwards. Here’s from the memo to legislator’s explaining the bill:

    Wisconsin’s Unfair Sales Act, known as the minimum markup law, prohibits sales of merchandise and prescription drugs at a price below the cost of merchandise to the seller. This bill removes the prohibition of selling certain merchandise and prescription drugs below cost.(Note: LRB 2338 does not apply to motor vehicle fuel, tobacco products, fermented malt beverages, liquor, wine or groceries.)

    With these items exempted, maybe we can finally get this bill passed.

     

     

     

  3. Owen Owen says:

    Well, that’s a significant mistake in the article! I like it even better that way.

  4. billphoto says:

    Exempting ” motor vehicle fuel, tobacco products, fermented malt beverages, liquor, wine or groceries” sucks.  those are the items we are getting soaked on the most.  Time to speak to Lea and Jim about this bill.

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