A Craft Beer Tax Battle is Brewing on Capital Hill

[FlyBoyKnight]

http://www.npr.org/blogs/thesalt/20...ign=npr&utm_term=nprnews&utm_content=20150312

Saw this article yesterday about the future of the excise taxes imposed on breweries.

The highlights:

.......
"But like any small business, there are challenges. And for small brewers one of the biggest challenges comes in the form of something called the federal excise tax.

Here's how it works. Brewers pay a federal tax on each barrel of beer they produce. Currently small breweries that produce less than 2 million barrels of beer each year pay $7 on their first 60,000 barrels. For each barrel more than 60,000 they pay $18.

The Small BREW Act — the bill that McHenry and the Small Brewers Caucus supports — would cut that tax in half for the first 60,000 barrels. So instead of paying $7 for each barrel, brewers would pay $3.50. For every barrel past 60,000 up to 2 million, brewers would pay $16. After 2 million barrels, breweries would pay $18 per barrel. Any brewery that produces fewer than 6 million barrels of beer each year would be eligible for these rates.

But there's another bill in Congress targeting the beer business: the Fair BEER Act. Its backers say it would provide tax relief not just for small brewers, but for all brewers.

.......

The Fair BEER Act would eliminate the federal excise tax for brewers who produce up to 7,143 barrels. For every barrel between 7,143 and 60,000, brewers would pay $3.50 a barrel. For every barrel between 60,001 and 2 million, brewers would pay $16 per barrel. And after 2 million barrels, brewers would pay $18 per barrel.

The Fair BEER Act also extends these tax rates to importing producers."
.......

I remember reading a thread a little while ago about Sam Adam's trying to lobby to redefine how a "craft" brewery is designated (so they could retain that status and associated lower excise tax). I wonder if this is in any way related to that. I also did not ever hear the outcome of that from 2010 I believe.

 

[BrewSavage]

A full barrel of beer is something like 165 twelve oz servings.

So a savings of $3.50 per 165 servings is $0.02 per serving to be passed on to customers for sure! woooooo-hoooooooooo!!!

Without further eloquence, let me respectfully suggest to our esteemed colleagues, be they from the mountains, or the prairies, or states on the oceans (white with foam (but I do digress)), that we set aside our petty partisan differences and pass this measure and find ourselves awash with amber waves of grain.

Indeed we need to make barley legal. Let it be written, let it be done.

 

[Phunhog]

So if the Fair BEER Act passes it would eliminate federal excise taxes on brewers up to 7,143 barrels. I wonder if that could possibly impact homebrewers in a positive way. Right now we are limited to 200 gallons a year....anything over that amount is prohibited because of excise taxes. Remove the excise tax and there would be no excuse not raise the 200 gallon limit.

 

[phug]

I'm sure the teeniest breweries would appreciate the extra 25 grand a year back in their pocket.

 

[Zepth]

So a savings of $3.50 per 165 servings is $0.02 per serving to be passed on to customers for sure! woooooo-hoooooooooo!!!

Doubt you'd see it at a consumer level.

I'm sure the teeniest breweries would appreciate the extra 25 grand a year back in their pocket.

Trusting your math here, but this is my thoughts exactly. That amount of increased cash flow can really help out a small business just getting their foothold. He|| even just being able to rent a billboard on a main road "This towns newest microbrewery 2 blocks that way -->" would make a difference. I went over a year driving within 1/2 mile of a microbrewery without even knowing they existed. That made it difficult for me to support them.