The act would reform the federal beer tax imposed on brewers and beer importers and give a special boost to small brewers. The idea is to create a laddered rate that is based on how much a brewer produces, much the same way the income tax rate is higher the more money you make.
Currently, brewers are charged $7 a barrel on the first 60,000 barrels and $18 on every barrel thereafter. Two tiers do not address the wide variety of brewers in the market today.
The act, which was introduced by U.S. Reps. Steve Womack, R-Ark., and Ron Kind, D-Wis., would establish a more subtle schedule:
– No excise tax on the first 7,143 barrels;
– $3.50 a barrel on barrels 7,144-60,000;
– $16 a barrel on barrels 60,001-2 million; and
– $18 a barrel on every barrel above 2 million.The 7,143 barrel cutoff is tied to the Treasury Department’s definition of a small brewer, which applies to 90 percent of American breweries. These are the small business people who provide variety to local bars and super-markets, but are not large enough to see economies of scale, to afford big marketing budgets or to sign national distribution deals.
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The act has more than 20 co-sponsors, but none are from Texas. That’s a glaring omission since Texas has the second-largest congressional delegation and a rich history of beer brewing.
That’s for sure. It’s a bipartisan small business tax cut that would benefit a lot of Texas breweries. I have no idea what the hangup is. There’s not a whole lot of legislation worth supporting out of this Congress, so let’s grab the few good bills there are with both hands. The Fair BEER Act is HR 767, and you can see some more information about it here. This press release has more.