Sunday, May 12, 2013

Federal brewers tax cut proposal reintroduced

Legislation to cut in half what craft brewers pay in federal excise tax has been reintroduced in both houses of Congress. 

Craft brewers now pay $7 per barrel on the first 60,0000 barrels they produce and $18 for every barrel on top of that. 

The proposed Small Brewer Reinvestment and Expanding Workforce Act would halve the first tier of the production tax and create a second tier of $16 levied on production from 61,000 to 2 million barrels. 

The tax after 2 million barrels would remain $18.

Proposals to cut excise taxes were last introduced in 2011 for the 112th Congress, but the legislation stalled. (There have been several instances of similar legislation proposed in Congress in the past.)

The legislation was reintroduced in the House of Representatives three months ago. Last week, the Colorado-based Brewers Association, the trade group representing the craft brewing industry, announced companion legislation had subsequently been introduced in the Senate by Ben Cardin, a Maryland Democrat, and Susan Collins, a Republican from Maine. 

New Jersey Sen. Robert Menendez posted a statement on his website that he is a co-sponsor of the bill.

Nationally, the craft brewing industry employ more than 108,000 full- and part-time workers, generating more than $3 billion in wages and benefits, while contributing $2.3 billion in business, personal and consumption taxes.

Supporters of the legislation say lowering the tax rate would enable the nation's 2,400 craft production brewers and brewpubs to hang on to an additional $60 million annually, money that could be reinvested in their brewery operations to grow them regionally or put them on a national footing. In the process, supporters say, brewers would likely be creating jobs. 

The bill numbers are H.R. 494 and S. 917.

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