This week the US Senate is considering a proposal that could raise the federal excise tax on beer as a way to offset the cost of health care reform. This could raise the tax on 4.5%ABV beers up to triple what they are now and beers with higher ABV rates up even more. Since a lot of craft brewers make beers that are over 4.5%ABV, this would hurt a lot of them and us, in that they would either A) have to raise their prices which means more expensive beer for us, B) they wouldn't be able to afford to make the great craft beers that they do now or C) would hurt the amount of money they are making now thus, hurting jobs at the brewery. I don't think we want any of these things to happen. Florida Senator, Bill Nelson, is on the Senate Finance Committee and is one of the people introducing this proposal. We need to let Senator Nelson know that this proposal is not going to help the American people but will hurt small businesses and their employees. You can contact Senator Bill Nelson by either calling his office at (202) 224-5274 or by emailing him here. Though you won't actually get to talk to Senator Nelson, they do log all calls and emails. His staffers report what he has gotten the most calls about and are there to focus largely on just that. The more calls and emails the better. When you call or email make sure to touch on these points:
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 their 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 already struggling to deal with the consequences of the 2008 spike in ingredient and operational costs.