Alcohol Sales in Texas: Liquor Laws and COVID-19

As is the case in most states, the COVID-19 pandemic has affected alcohol sales in Texas and prompted officials to make changes to liquor laws to allow for additional alcohol delivery methods. In the wake of mandatory business closures and event cancelations, there has been a significant decline in on-premise alcohol consumption across the state of Texas. Hopefully, allowing to-go sales of mixed drinks will help businesses stay afloat while also keeping customers safe. 

Before the pandemic hit, top alcohol sales in Texas were associated with venues like concert halls, sports arenas and resorts. Some top performers included: Metroplex Sportservice, Texas Live!, Gaylord Texan Resort, Kalahari Resort and AT&T Stadium. Since these locations were forced to shut down, bars and restaurants became some of the top sellers. In December 2020, the top alcohol sales were at Matt’s El Rancho in Austin, Nick and Sam’s Steak & Fish House in Dallas and Mastro’s Steakhouse and Willie G’s at the Post Oak in Houston. 

Alcohol Tax in Texas

The alcohol tax in Texas varies slightly based on the type of alcohol. In Texas, liquor is subject to an excise tax of $2.40 per gallon of spirits. For beer, an extra 19.4 cents is added and wine has a tax of 20.4 cents. However, any wine that is sparkling has an additional $0.516/gallon and any wine over 14% alcohol has an additional $0.408/gallon in excise tax. A sales tax of 6.25% is also applied to all alcohol and local taxes can add an additional 2% sales tax in some locations. An 8.25% tax rate is imposed on mixed beverages. Finally, all airline drinks are taxed an additional 5 cents per drink.

Where Can You Buy Alcohol in Texas?

There are some limitations on where you can buy alcohol in Texas. Liquor can only be purchased at designated liquor stores, which are open Monday-Saturday from 10am to 9pm. Liquor stores are always closed on Sundays. Beer and wine, on the other hand, can be purchased at most grocery, drug and convenience stores. 

Alcohol Sales in Texas and COVID-19

The Texas Alcoholic Beverage Code (TABC) has been working to provide bars and restaurants with easy access to vital information during the pandemic. They understand that COVID-19 has had a significant impact on the alcohol sales in Texas. Mandatory closures and other operational regulations that are meant to prevent or slow the spread fo COVID-19 have made it difficult for bars and restaurants to survive.

To help increase alcohol sales in Texas, Governor Abbot has relaxed certain laws so that bars and restaurants can provide to-go drinks. The existing law doesn’t allow anyone with a Mixed Beverage Permit (MB) from selling to-go drinks that are meant to be consumed off-premise unless they also have a Food and Beverage Certificate. However, this law has been suspended and bars and restaurants can now provide pick-up and delivery orders that include mixed alcoholic beverages. 

The TABC is also making it easier for restaurants to qualify for a Food and Beverage Certificate. Some of the more expensive and challenging requirements have been removed. This means that businesses don’t have to make drastic changes or invest in new equipment. 

Currently, anyone who has a Consumer Delivery Permit can offer alcohol to-go and delivery orders. For a more detailed look at which establishments are allowed to serve to-go and delivery alcoholic beverages, consult this chart. You can find additional information about TABC requirements here.   

While the landscape for alcohol sales in Texas has changed, hopefully looser restrictions will help bars and restaurants survive until they are allowed to be fully operational. Other states, such as Florida and Ohio, may also watch for trends in alcohol sales in Texas and use these insights to make their own decisions regarding existing laws. 

If you’re looking to increase your alcohol sales revenue in 2021, learn how to improve your sales process for alcohol sales here.

FAQs

What are the top alcohol sales in Texas? 

In December 2020, the top alcohol sales in Texas were Matt’s El Rancho in Austin, Nick and Sam’s Steak & Fish House in Dallas and Mastro’s Steakhouse and Willie G’s at the Post Oak in Houston. 

What is the alcohol tax in Texas? 

In Texas, liquor is subject to an excise tax of $2.40 per gallon of spirits. For beer, an extra 19.4 cents is added and wine has a tax of 20.4 cents. However, any wine that is sparkling or has over 14% alcohol has an additional 40.8% excise tax. A sales tax of 6.25% is also applied to all alcohol and local taxes can add an additional 2% sales tax in some locations. If alcohol is consumed on-premise, there is a 14.95% tax. Finally, all airline drinks are taxed an additional 5 cents per drink.

Can you buy liquor in grocery stores in Texas? 

No, liquor is only sold at specific liquor stores which are open Monday through Saturday from 10am to 9pm.

How has Covid-19 affected alcohol sales regulations in Texas? 

The Governor of Texas has eased restrictions and allowed certain bars and restaurants to offer to-go and delivery orders for mixed beverages.

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