Ordering a cocktail at dinner or grabbing a case of beer from a liquor store in Kentucky may soon come with a bigger price tag if House Bill 612 becomes law.
The state introduced the bill, which would impose an additional 4% state regulatory license fee on gross receipts. Essentially, if passed, it would be an extra 4% fee on all alcohol sold in Kentucky, affecting restaurants, bars, liquor stores and convivence stores.
“It’s [going to impact] the corner store on the west end of Newport, it’s Jeff Ruby’s in Lexington, it’s Pompilio’s in Newport, it’s One Stop Liquor, it’s Kroger, it’s everybody,” said Kentucky Restaurant Association 2026 Chairman and one of Pompilio’s owners, Joe Bristow.
Combined with Kentucky’s 6% sales tax, the consumer would effectively pay 10% on their alcohol purchases. A $100 purchase today would bring you $106 after the 6% sales tax. A $100 purchase under the bill would be $110.
HB 612 was introduced by Representative Matthew Koch, a Republican from Paris, on Feb. 10. Koch is the chair of the Licensing, Occupations, & Administrative Regulations Committee. If passed, it would take effect on July 1, 2027.
Bristow said he found out about the proposed bill on Jan. 29 and got to work spreading the word.
“We got to spreading the word and it has worked,” he said. “Not only in Northern Kentucky, it’s spreading like wildfire, as it should. It’s huge. It’s a big deal.”
In Newport, customers already pay a 2% regulatory fee on alcohol sales. Meaning, if HB 612 passes, Newport customers would pay an extra 12% in fees. Bristow said Newport has offered some help to offset that fee, such as refunds on liquor license renewals. He said he knows Newport isn’t the only city in the state that has its own regulatory fee, but he didn’t know which others do.
Bristow said the restaurant could put “city of Newport regulatory fee 2%” on the check, or just raise its prices by 2%, which is what they chose to do to absorb the cost.
Now, Pompilio’s is back in the same boat. It could put the message at the bottom of the check. A customer would see “Kentucky sales tax 6%,” then another line item that says, “Kentucky regulatory fee 4%,” or raise its prices.
“We just want to be in control of our own pricing,” Bristow said. “This all happened so quick. It will be a major impact on Pompilios. It will not close us, but it’s certainly not going to help.”
The bottom line: The consumer will pay for it.
“It’s not a position we want to be in,” Bristow said. “Being so close to Ohio, people know that if they stay in Ohio, they can get a discount, basically.”
Whitney Frommeyer is the managing partner at Bellevue’s One Stop Liquor Store on Donnermeyer Drive. The store opened in 1995. Her brother-in-law, Paul Kloeker, manages and operates the One Stop Fuel Mart BP Gas Station, which the family has owned since 2013.
Frommeyer said that when stores raise the price of their products, customers either don’t come back or go somewhere else.
“Across the state, a lot of your liquor stores are small businesses,” Kloeker said. “It’s not an industry like grocery stores or gas stations, where it’s all the big corporate entities that own them. A lot of these liquor stores are family-owned. They have family running it, just like we have here.”
Frommeryer said sales at the store have already been down.
According to a Gallup article from August 2025, “From 1997 to 2023, at least 60% of Americans reported drinking alcohol. The figure fell to 62% in 2023 and to 58% in 2024, before reaching 54% today.”
“[If the bill passes] I just see sales declining and declining,” Frommeyer said. “Instead of buying a big bottle of alcohol, they’ll buy the small one, because they don’t have as much money, too.”
So, why is the bill being proposed? One idea from Bristow is to help the state’s distillers.
“It’s coming because the distillers in our state need some help, and the restaurant industry, we don’t want to find ourselves in a fight with the Kentucky distillers,” Bristow said. “We love and support them, and the tremendous product that they make is important to us, too. They’re heavily taxed, so the state is trying to work with them to give them some tax relief.”
Distillers are currently taxed on sales. Under the bill, those taxes would effectively be eliminated. That tax system would end July 1, 2027, and be replaced by a tax per milliliter of alcohol contained in the beverage applying to: wholesalers, distributors, distillers, wineries, direct shippers and microbreweries.
The state is calling the bill revenue-neutral, meaning it will not generate any revenue for them going forward, based on how they developed the formula, essentially shifting the responsibilities of where the taxes are coming from. However, that would rely on the manufacturer’s price to the wholesaler staying the same, and then the wholesaler’s price to the retailer staying the same.
Adam Blau, owner of The Liquor Box in Independence, said the consumer will basically pay an extra 10% for alcohol with no extra revenue going to the state.
“The newest legislation they’re trying to push through in the state is going to have a serious impact on the consumer,” Blau said. “It’s going to cost the consumer 10% with zero additional funding going back to the state, versus what we already have in place.”
Bristow said basically the state is moving from a manufacturing-based tax to a consumer-based tax.
“I’m assuming they’re struggling with people’s palate changing and tariffs, and the states wanting to do something to help them [distillers], which I’m in favor of absolutely, but I just feel like there could have been more communication,” he said. “Maybe we could have figured out a different plan; we got this thrown at us relatively quickly.”