Independent beer distributors partner with brewers of all sizes â from established brands to new, local ... Beer distr
2015
Federal Excise Taxes I
ndependent beer distributors partner with brewers of all sizes − from established brands to new, local breweries. Growth in the number of breweries – from fewer than 50 in 1983 to more than 3,000 today – has been facilitated by an open beer distribution system that allows access to market for brewers of all sizes.
Two bills have been introduced in the 114th Congress that would reduce excise taxes for brewers. Beer distributors do not receive a tax reduction under either proposal and are not asking for excise taxes to be reduced. Should Congress advance excise tax legislation, NBWA encourages Congress to support legislation that reflects current industry structure and includes all brewers.
NBWA Opposes the BREW Act The BREW Act has been introduced in the House (H.R. 232) by Reps. Erik Paulsen (MN) and Richard Neal (MA) and in the Senate (S. 375) by Sens. Susan Collins (ME) and Ben Cardin (MD). The BREW Act seeks changes to the tax code that could impact state laws which support an open and independent beer distribution system. ■■
Current law allows preferential tax treatment for brewers producing up to 2 million barrels annually.¹
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99% of U.S. breweries produce less than 2 million barrels annually.
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The BREW Act would increase that preferential tax treatment to include brewers producing up to 6 million barrels annually – a change that would benefit only a few specific brewers.
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A 31-gallon barrel equals 13.8 cases or 330 12-ounce servings of beer. Six million barrels equals approximately 83 million cases or 1.98 billion servings.
The Fair BEER Act Offers a Balanced Approach The Fair BEER Act has been introduced in the House (H.R. 767) by Reps. Steve Womack (AR) and Ron Kind (WI) and in the Senate (S. 807) by Sens. Roy Blunt (MO) and Tammy Baldwin (WI). The Fair BEER Act reflects current industry structure and reduces excise taxes for brewers of all sizes. ■■
More than 90% of U.S. breweries produce less than 7,143 barrels of beer annually, according to the Alcohol and Tobacco Tax and Trade Bureau.
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The Fair BEER Act completely eliminates the federal excise tax on the first 7,143 barrels produced by brewers of all sizes, giving the smallest craft brewers greater relief and more ability to reinvest and grow.
Craft Beer Segment Continues to Grow The tremendous growth in craft beer sales underscores independent beer distributors’ role in helping craft brewers grow by reaching a wide network of retailers and consumers. Today’s marketplace offers an unparalleled number of choices. ■■
According to the Brewers Association, craft brewers enjoyed another year of double-digit growth in 2014, with a record 18% volume increase.
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Outdated estimates of the BREW Act understate its projected cost and fail to take into account the entry into market of new craft brewers over the last several years and the consecutive annual growth of sales. NBWA opposes the BREW Act and asks members of Congress to refrain from cosponsoring or helping advance the legislation. If Congress pursues excise tax reform for brewers, the Fair BEER Act reflects current industry structure and allows for excise tax reduction for brewers of all sizes.
National Beer Wholesalers Association
1101 K ing Street, Suite 600 • A lexandria, Virginia 22314 -2965
