A major beer importer in American Samoa, says the proposed increase in the excise tax for imported beer will not help to raise government revenue, but will create a new problem of a black market for beer.
The proposed beer tax hike is included in an administration bill, that also increase excise tax on cigarette and alcohol.
The government estimates to collect 3 million US dollars a year in revenues.
GHC Reid company is the importer for Vailima, Steinlager, Coors Light, Miller Genuine Draft and Heineken beer.
The company's president Olivia Reid-Gillet says the proposed hike from 190 percent to 250 percent - is a 32 per cent increase that the industry will not be able to sustain.
She says the proposal would cost the government millions in lost excise taxes and would only create a new problem of smuggling beer into the Territory avoiding any taxes.
She says history has shown that whenever there is an increase in import duties, imports will always decrease exponentially because consumers will simply not purchase the same volumes at the higher prices.