Blog: Tax issue is no small beer for US brewers
James Wilmore | 17 May 2013
The gloves are off in Washington DC as the big (and the not so big) brewers tussle with small brewers over tax.
In the red corner, are the likes of Anheuser-Busch InBev and MillerCoors, who are backing the 'Brewers Excise and Economic Relief Act of 2013', otherwise known as the BEER Act.
Under the Act, introduced in the House of Representatives last week, the federal excise tax on beer for all brewers and beer importers would be cut.
This is the proposal:
· Small brewers would pay no federal excise tax on the first 15,000 barrels; US$3.50 on 15,001 to 60,000 barrels and $9 per barrel for every barrel over 60,000 and up to 2m barrels
· Brewers producing more than 2m barrels annually, and for all beer importers regardless of size, the federal excise tax rate would be $9 per barrel for every barrel
The Beer Institute, the US trade body which represents the big brewers, claims this a "fair, equitable tax policy".
However, in the blue corner representing smaller, craft brewers, the Brewers Association (BA) is not impressed. An alternative act, the Small BREW Act, which reached the Senate last week, seeks cuts only for smaller scale producers.
But it is a tangled web, as Jason Notte explains, writing on The Street website. For one, Brooklyn Brewery is among those supporting the BEER Act. Meanwhile, he suggests that the levels proposed in the Act would imply that Boston Beer Company is not a craft brewer, which is part of the reason the BA changed its defintion two years ago.
Meanwhile, Deschutes Brewery founder Gary Fish also found himself caught between the two.
Who'll be left standing?
Whisk(e)y companies spend a lot of money and effort ageing their products for that premium taste....
PepsiCo created a stir last week with the news it is testing a product called Caleb's Kola, with some in the media claiming it was the beginning of a new “craft soda” category....
SABMiller's bid to widen the appeal of beer is very much in evidence at its latest 'House of Peroni' - with beer cocktails and a bigger bottle for the Italian lager brand on offer. ...
Here's a round-up of the big stories on just-drinks last week, featuring PepsiCo, SABMiller, the Scotch whisky category and the US wine market....
- Analysis - Remy's Cognac "dead-cat bounce"
- Diageo's future brighter than present suggests
- Diageo's Q1 Results by Region
- Focus - Remy Cointreau's H1 Performance by Brand
- SABMiller's troubles fuel M&A rumours
- Moët Hennessy unveils first Travel Retail outlet
- Diageo puts Beckham centre stage in Haig Club ad
- United Spirits sees Q1 net loss
- Beam Suntory, Edrington part ways in Travel Retail
- TWE unveils Penfolds range after CEO's "bold move"