On the February 15 edition of Fox & Friends, three very different craft brewers explained the importance of recalibrating federal excise taxes on small brewers. If you take craft beer appreciation seriously, then this topic may be of interest to you.
Watch the interview: Brewers Introduce Beer Stimulus Plan
More information on the legislative efforts related to federal excise tax reduction for today’s small breweries is provided by the Brewers Association, publishers of CraftBeer.com. Below is a quick overview of some of the key points.
Federal Excise Taxes and Small Brewers
Nationally, small and independent craft brewers employ nearly 100,000 full- and part-time employees, generate more than $3 billion in wages and benefits, and pay more than $2.3 billion in business, personal and consumption taxes. These brewers are vital small businesses in communities across the country, typically employing 10 to 50 employees.
More than 99 percent of all small businesses do not pay federal excise taxes on their services or products, yet today’s small breweries do.
Relieving the impact of federal excise taxes (recalibrating them from $7 to $3.50 per-barrel up to the first 60,000 barrels produced, and $18 to instead $16 per-barrel for 60,001 barrels up to 2 million) will help small breweries grow as small businesses, create more jobs and compete with global competitors, while continuing to contribute to the economies of their local community.
As small businesses, craft brewers face many economic challenges. Because of differences in economies of scale, small brewers have higher costs for production, raw materials, packaging, and market entry compared to larger, well-established, multi-national competitors. Furthermore, efforts to increase state taxes for all brewers continues to threaten jobs and their economic stability.
Last Updated: February 15, 2011