CHICAGO — Chicago bar and restaurant owners joined the opposition to Mayor Brandon Johnson’s 2025 budget plan Wednesday, saying the 35% tax hike he wants on liquor sales would be ruinous to their businesses.

The proposed increase would be the city’s first since 2008, but the industry group convened at a news conference to say City Hall should look elsewhere to balance Johnson’s proposed $17.3 billion budget. In total, the levy hike is expected to net an additional $10.6 million from the city’s so-called “sin taxes” on beer, wine and liquor sales, bringing it to a total $40.6 million in revenue.

“There is no negotiation on this tax. We will fight it to all levels,” Pat Doerr, director of the Hospitality Business Association of Chicago, told reporters at the Haymarket Brewery in the West Loop. “We have done our part for the city coffers over the last four years, and there was not a point we could agree on in between on this after what we’ve paid in the past. We’re good earners for the city. We’ve earned enough, and we need a break.”

The city’s alcohol tax is imposed on retail sales of the beverages, so whenever a wholesale dealer sells to a retailer in Chicago — a bar, restaurant, liquor store, etc. — the city collects revenue.

Under Johnson’s plan, the tax for the sale of liquor that is 20% or more alcohol by volume would jump from $2.68 a gallon to $3.62 a gallon. Alcohol between 14% and 20% ABV would increase from 89 cents a gallon to $1.20 a gallon, while non-beer alcohol under 14% rises from 36 cents a gallon to 49 cents a gallon. Lastly, beer sales would go up from 29 cents a gallon to 39 cents.

The hospitality lobby’s protests come during a difficult budget season for Johnson, who is battling critics on multiple fronts as he refuses to consider layoffs or furloughs in the wake of the staggering deficit, saying that would cut critical services to Chicagoans. Aldermen last week voted 50-0 to spike Johnson’s proposed $300 million property tax hike. Meanwhile, the Illinois Attorney General and other police reform voices have taken umbrage to the mayor’s planned cuts to Chicago police positions that are tasked with implementing the consent decree.

Johnson, for his part, has maintained it is incumbent on all stakeholders in city government to do their part on hammering out this tough budget. “My responsibility is to present a budget that’s balanced. Working with the City Council to actually pass that budget requires me to remain as collaborator-in-chief,” he told reporters on Tuesday.

Doerr on Wednesday argued the new costs from the alcohol tax hike, however, are unfair to impose on an industry that has already weathered a restaurant tax hike in 2020, the COVID-19 pandemic and staggering inflation that has just begun cooling down. Chicago businesses pay the city alcohol tax on top of county, state and federal taxes for liquor, as well as state and local sales taxes, a total Doerr’s group said amounts to one of the highest bundles of liquor taxes in the nation.

“Beer is a volume game, so the margins on it are very thin,” said Damon Patton, co-founder of Moor’s Brewing Company in Bronzeville. “You need a lot of volume to kind of make money in this business, and a tax hike would definitely hinder that progress. We need City Hall to stand with us and support the homegrown businesses like mine.”

Doerr said the mayor’s plan will lead to increased costs for consumers and could also backfire if those patrons, especially in the city’s 15 border wards, opt for cheaper drinks elsewhere. And he hinted that his coalition is making inroads with getting a majority of City Council on board, arguing that if the tax hikes depress small businesses, then the mayor won’t be able to plug in his budget gap with $10 million more in revenue after all.

“It’s death by a thousand cuts in a post-COVID world,” said Mark Robertson, co-owner of the LGBTQ tavern group 2 Bears, which has a location in Uptown. “Where I’m frustrated is I feel like City Council doesn’t understand the real world.”

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