Tag Archives: Brewers Association

Another Update On the Federal Tax Increase on Beer

There has been no new news on whats going to happen with the proposed Federal Excise Tax but there is still time for our voices to be heard. There are two websites that give information on what we can do to stop this tax from happening and I received an e-mail updating the situation from the Brewers Association that can be read bellow. The websites are www.sylb.org/excisetax.html and www.axetaxesnotjobs.com/index.aspx. I will continue to pass on any information that I come across.

Dear Beer Enthusiast,

Small brewers are facing an imminent and extremely serious threat to their businesses. The consequences of remaining silent have the very real potential of reducing your choice of beer and dramatically increasing the price of any beer that you purchase.

The Senate Finance Committee in Washington, DC is currently considering a proposal to increase and equalize the excise tax for alcohol beverages as part of healthcare reform deliberations. This proposal would triple the excise tax for 4.5% ABV beer and impose even higher excise tax rates for higher ABV beers.

If such a proposal becomes reality, there is no question that many small brewery businesses will suffer, some will close and consumers will face higher prices and diminished choice in the marketplace.

The Brewers Association brewery members and leadership have been actively engaged in building the case against an excise tax increase, recently submitting a letter to the Committee outlining our opposition.

We need you to speak out now. Today or tomorrow at the latest.

If you live in the following states it is most urgent that you contact your Senator who is on the Senate Finance Committee:

Arizona Nevada
Arkansas New Jersey
Delaware New Mexico
Florida New York
Idaho North Dakota
Iowa Oregon
Kansas Texas
Kentucky Utah
Maine Washington
Massachusetts West Virginia
Michigan Wyoming
Montana

If your Senators are not members of that committee, ask them to contact their Finance Committee colleagues and express their opposition to this proposal moving forward.

Your ask of them is simple:

Oppose the Tax Increase. Let them know that you oppose, in the strongest possible terms, raising the federal excise tax on beer because of the serious consequences it would have on small brewers and the craft beer they brew. Additional talking points appear below.

Once again: If one of your Senators sits on the Senate Finance Committee (roster of members below), urge them to oppose this proposal in committee deliberations.

If your Senators are not members of that committee, ask them to contact their Finance Committee colleagues and express their opposition to this proposal moving forward.

Take Action – Call and/or email your Senators’ Washington or district offices and make your personal case against this massive excise tax increase.

As always, thanks for your support.

Charlie Papazian
Charlie Signature
President, Brewers Association

Senate Finance Committee Members:

Baucus, Max (MT), Chairman Bingaman, Jeff (NM)
Bunning, Jim (KY) Cantwell, Maria (WA)
Carper, Thomas R. (DE) Conrad, Kent (ND)
Cornyn, John (TX) Crapo, Mike (ID)
Ensign, John (NV) Enzi, Michael B. (WY)
Grassley, Chuck (IA), Ranking Member Hatch, Orrin G. (UT)
Kerry, John F. (MA) Kyl, Jon (AZ)
Lincoln, Blanche L. (AR) Menendez, Robert (NJ)
Nelson, Bill (FL) Roberts, Pat (KS)
Rockefeller, John D. (WV) Schumer, Charles E. (NY)
Snowe, Olympia J. (ME) Stabenow, Debbie (MI)
Wyden, Ron (OR)

ISSUES OF IMPORTANCE TO SMALL BREWERS EXCISE TAXES

Small brewers are small Main street businesses, typically employing 10 to 50 employees.

  • Small brewers represent only 4% of the entire U.S. beer market by volume, with 95% of them being very small businesses (producing 15,000 barrels or less per year).

We strongly oppose proposals to increase the excise tax on beer.

  • Proposals to increase and equalize the tax among all types of alcohol will tax small brewers at the highest rates because our specialty, gourmet and innovative beers typically have higher alcohol contents.
  • Brewers already pay a disproportionately higher share of taxes compared with other products – federal, state and local taxes represent over 40% of the retail price for beer while the same taxes equal nearly 24% of the price for all other purchases.

Higher taxes will worsen the economic recession – resulting in less competitive products, reduced sales and revenues, lost jobs and, for some small brewers, business closures.

  • $1 per case excise tax increase will typically cost the consumer at least $1.69 due to successive mark-ups as the case moves from brewer to wholesaler to retailer.
  • Many small brewers are struggling to deal with the consequences of the 2008 spike in ingredient and operational costs.

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Update on the Federal Tax Increase on Beer

I recently received an e-mail as part of the American Homebrewers Association from Charlie Papazian president of the Brewers Association with an update on the federal tax increase on beer. Here is his statement:

Some of you are aware of the headline discussions in Washington DC this week and last week regarding proposals to dramatically increase Federal Excise Tax on brewers and other alcohol beverage industries.  Brewers Association staff and those who are working on behalf of the Brewers Association in Washington, DC are in daily and regular communications on how to best represent small brewers concerns in these very critical discussions.  Dramatic excise tax increases would be harmful to both small brewery businesses and to the existing American beer culture of enjoyment and responsibility.
Brewers Association
In order to gain strategic ground before any Federal Excise Tax increase was proposed, the Brewers Association earlier this year teamed up with the Beer Institute to help introduce two bills advocating a reduction in Federal Excise Tax. These two bills are House Bill H.R. 836 and Senate Bill S.1058.  They are helpful as both a defense and as a proactive initiative.  H.R. 836 has 178 co-sponsors.  S.1058 introduced last week has an initial 7 co-sponsors in the Senate.  These two bills can help us push back on proposals to dramatically increase excise taxes on small brewers and the industry as a whole.
Earlier this year small brewers were asked by BA to call their Representatives and ask them to sign on as co-sponsor of H.R. 836.   Soon they will be receiving information asking them to call their Senator to become a co-sponsor of S. 1058.
In addition to the threat of Federal Excise Tax increases, the Administration’s new budget outline proposes the establishment of annual user fees to fund TTB’s agency budget, which in effect would be an additional tax on brewers and other related industries.
Brewers Association is involved in expressing concerns on behalf of small brewers and beer enthusiasts on these two legislative matters.  You may hear from us in the near future regarding actions which you can be involved in on these matters.
The Brewers Association feels it is of utmost importance during these critical times that the beer industry present a united and coordinated effort on the federal level.  This is why we have teamed with the Beer Institute to help us represent our constituencies.  If you are involved or are considering being involved in any other Federal initiatives that would be relevant to American small brewers, please let us know about them.
Contact:
or Charlie Papazian charlie@brewersassociation.org
Note:  On June 2, the Brewers Association is hosting a “Celebration of American Craft Beer” reception for congressional representatives and their staff on Capitol Hill.  We will recognize the two co-chairs of the House Small Brewers Caucus, Peter DeFazio (OR) and Denny Rehberg (MT).  The House Small Brewers Caucus (which currently has 46 members) has been championing issues relevant to both homebrewers and small brewers.
Brewers Association staff and brewery members will also attend and make presentations at the House Small Brewers Caucus’s meeting preceding the reception.
Thank you for your valued membership of the American Homebrewers Association,
Charlie Papazian, President

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