It Must Have Been One Heck of a Party

May was Biggest Month Ever for Tax Revenue From Mixed Drinks in LG 

Somebody must have run up a really big bar tab in La Grange recently.

Usually the city gets about $3,000 a month from the state as its share of the tax on mixed drinks. But in May, La Grange got nearly ten times that amount - $29,891.04 to be exact.

It was the biggest single month ever.

Fayette County also got an unusually high May mixed drink tax payment. Instead of the usual $10,000 or so, the county got $44,254.13.

Where the huge increase came from isn’t known, since tax payments are confidential.

Round Top had a nice increase in May, too, but nothing like La Grange and Fayette County.

As with everything involving alcohol, the Texas Mixed Drink Tax is complicated.

The taxes are paid by every entity with a Texas mixed drink permit and even though it’s called “mixed drink tax,” it actually is applied to sales by a

permit holder on any alcoholic beverage – beer, wine, ale or distilled spirits.

A bar or restaurant that is permitted only for beer or wine only pays the regular sales tax.

And to complicate it even more, the “mixed drink tax” includes both a gross sales component and a sales tax component. Combined, it amounts to 14.95 percent on every drink sold.

The State Comptroller’s office allocates 10.7143% of the taxes collected back to the county and city in which they were collected. The local allocation is divided equally between the county and the city.

Despite the complications, it amounts to a small but usually steady income stream for local governments. This month, however, La Grange and Fayette County may be ready to party. Their year-todate revenue is several times larger than the same period last year.

So far as parties are concerned, though, Round Top has long been Party Central for Fayette County.

While La Grange got $31,682 in mixed drink tax for all of 2023, Round Top got nearly double that, at $62,501. Though tiny, Round Top packs in the drinkers. Every year since 2019, Round Top has taken in more mixed drink tax revenue than La Grange.

In fact, some years Schulenburg has received more revenue from the tax than La Grange. For the past five years, however, it has been Round Top first, La Grange second and Schulenburg third.

Flatonia, Fayetteville and Carmine also have revenue thanks to their local mixed drink permit holders. This past year, Carmine actually passed Fayetteville in revenue from the tax and so far in 2024, Carmine is still ahead.

After the May payments, Fayette County has received $84,253 so far this year; La Grange, $41,438; Round Top, $24,263; Schulenburg, $5,933; Flatonia, $2,150; Carmine, $1,643; and Fayetteville, $1,272.