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house Bill H.R. 767

Should Taxes on Beer Vary Based on the Amount Brewed?

Argument in favor

The current tax structure for beer production makes it hard for small craft breweries to compete with large producers. Reducing those taxes would help small breweries grow, create jobs, and brew cheaper beer for consumers.

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04/07/2016
I don't believe a tiered structure based on production volume to be inherently unfair. We also proclaim a desire to help the little guy succeed in the world. Making the tax code help smaller companies grow will lead to more companies graduating to the higher tier of taxes anyway. It's a win, win!
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Austin's Opinion
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04/07/2016
By voting yea to this bill, you are giving small breweries the opportunity to achieve their dream.
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Methos's Opinion
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04/07/2016
Obviously if you make a million gallons easily, you should pay more then a company that's strikes to get a hundred thousand
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Argument opposed

It would be wrong to change the way that the tax code treats varying amounts of beer production without reforming how other beverages like cider are taxed. Besides, the federal government needs all the tax revenue it can get.

Scott's Opinion
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04/07/2016
Do you people really have nothing to do? The country is going to hell and you guys vote on stupid questions like this!😡
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BTSundra's Opinion
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04/06/2016
Simplify the tax code, don't further complicate it. A flat tax would help this too.
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Zachary's Opinion
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04/07/2016
Gasoline isn't taxed by the amount of gasoline that is in each gallon, so why should beer?
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What is House Bill H.R. 767?

This bill — known as the Fair BEER Act — would revise the excise tax on beer that’s brewed or produced, and consumed or sold within the U.S. or imported into the country. It would create four excise tax tiers based on the amount of beer produced or imported, which increase as the amount of beer brewed or imported increases.

The new excise tax ranges would be as follows:

  • $0 per barrel on amounts of beer less than 7,143 barrels;

  • $3.50 per barrel on amounts of beer between 7,144 and 60,000 barrels;

  • $16 per barrel on amounts of beer between 60,001 and 2,000,000 barrels;

  • $18 per barrel on amounts of beer exceeding 2,000,001 barrels.

If enacted, these changes would take effect for the 2016 tax year.

Under current law, beer production is taxed at a rate of $18 per barrel except for smaller brewers that don't produce more than 2 million barrels, which only pay $7 per barrel for the first 60,000 barrels they produce.

Impact

Consumers of beer; brewers and importers of beer; and the Dept. of the Treasury.

Cost of House Bill H.R. 767

A CBO cost estimate is unavailable.

More Information

In-Depth: Sponsoring Rep. Steve Womack (R-AR) introduced this bill to ensure that the growth of America’s beer industry isn’t stifled by the tax code:

“Our tax policies shouldn’t discourage the growth and continued success of an industry that supports jobs for more than two million Americans, and it shouldn’t pick the winners and losers in the market. This comprehensive reform bill supports brewpubs, microbrewers, national craft brewers, major brewers, and importers alike and encourages their entrepreneurial spirit, which is exactly the spirit we need to get America’s economic engine going again.”

Currently this legislation has the support of 117 bipartisan cosponsors in the House, including 64 Republicans and 53 Democrats.


Of Note: Beer has been a mainstay in American life throughout the country’s history, even pre-dating the establishment of North America’s first known brewery in 1612 near what became Manhattan. American soldiers were given beer rations (1 quart per day) during the Revolutionary War, and during the first year of his presidency George Washington announced that he would only drink beer brewed in the U.S. 

Today, the beer industry contributes $246 billion to the U.S. economy and over $49 billion in tax revenue to governments at all levels, while employing more than 2 million Americans. There are over 2500 microbreweries and brewpubs, which account for the majority of the growth in the industry. The Beer Institute estimates that at least 40 percent of the money a consumer spends on beer goes to paying taxes at the federal and state level.

The taxation of alcohol has been controversial in the U.S. since 1791, when whiskey became the first domestic product to be taxed by the federal government. The excise tax applied to all distilled beverages, but whiskey’s enormous popularity led to what became known as the Whiskey Rebellion, where Americans resisted the collection of the taxes - sometimes violently. The first tax on beer was introduced in 1862, and the $1 per barrel excise tax was used to finance the government’s operations during the Civil War.



Media:

Summary by Eric Revell
(Photo Credit: Flickr user amberdegrace)

AKA

Fair BEER Act

Official Title

To amend the Internal Revenue Code of 1986 to reform and reset the excise tax on beer, and for other purposes.

bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
  • The house has not voted
      house Committees
      Committee on Ways and Means
    IntroducedFebruary 5th, 2015