The Brewers Institute announced yesterday the introduction of the Brewers Excise and Economic Relief Act of 2013 (BEER Act), H.R. 1918. This legislation would reduce excise taxes for all brewers and beer importers.
Under the BEER Act of 2013:
• Small brewers would pay no federal excise tax on the first 15,000 barrels;
• Small brewers would pay $3.50 on barrels 15,001 to 60,000;
• Small brewers would pay $9 per barrel for every barrel over 60,000 and up to 2 million barrels;
• For brewers producing more than 2 million barrels annually, and for all beer importers regardless of size, the federal excise tax rate would be $9 per barrel for every barrel.
Meanwhile the Brewers Association announced today the introduction of S. 917, The Small Brewer Reinvestment and Expanding Workforce Act (BREW Act). This is a companion bill to an identical bill already introduced on the House side.
Under current law, brewers generally pay an $18 excise tax on each barrel brewed. Small brewers, currently defined as those that brew fewer than 2 million barrels of beer a year, pay a reduced excise tax of $7 per barrel for the first 60,000 barrels of beer they brew each year. The BREW Act would reduce the excise tax applicable to brewers producing up to 6 million barrels per year to just $3.50 on the first 60,000 barrels and $16 on additional barrels below 2 million per year.
The BI will be pushing their bill on the Hill in while the BA will be promoting their bill. Both benefit craft brewers but the BEER Act also gives a tax break to the large brewers. Critics of the BREW Act have stated that 6 million barrels is far too high as a “small brewer” threshold and that it should be kept at 2 million or 4 million at the most. Critics of the BEER Act complain that the overall cost to the taxpayer is too high and it gives a tax break to global beer companies that are foreign owned.
It is highly unlikely that either bill will pass.