Washington DC - Oregon’s Senator Jeff Merkley cosponsored legislation Wednesday that will encourage job growth by reducing the beer excise tax on American small brewers.
“Oregon’s brewers are a valuable part of our state’s economy and culture,” Merkley said. “They employ thousands of Oregonians and brew beers recognized the world over for their quality and flavor. This bill is an opportunity to create jobs while supporting Oregonians who take immense pride in their craft and brew a darn good pint of beer.”
The over 1,500 small breweries that operate in America employ nearly 100,000 people, generate more than $3 billion in wages and benefits and pay more than $2.3 billion in business, personal and consumption taxes. Oregon is home to 77 brewing companies and Portland has more 33 microbreweries within its city limits, more than any other city in the world. The overall economic impact of breweries in Oregon alone is $2.3 billion.
Bill highlights:
- Currently, a small brewer that produces less than 2 million barrels of beer per year is eligible to pay $7.00 per barrel on the first 60,000 barrels produced each year. Reducing this rate to $3.50 per barrel would provide approximately $18.0 million per year to help strengthen our nation’s smallest brewers and support their efforts to maintain and generate jobs.
- Once production exceeds 60,000 barrels, a small brewer must pay the same $18 per barrel excise tax rate that the largest brewer pays at over 100 million barrels. Lowering the tax rate to $16 per barrel on beer production above 60,000 barrels up to 2 million barrels would provide small brewers with an additional $26.2 million per year that would be used to support significant long-term investments and create jobs by growing their businesses on a regional or national scale.
- The small brewer tax rate was established in 1976 and has never been updated. Since then the annual production of America’s largest brewery increased from about 45 million to 107 million barrels. The ceiling defining small breweries is 2 million barrels and the legislation would increase it to 6 million barrels.
The bill’s lead sponsor is Senator John Kerry (D-MA) and the bill’s other original cosponsors are Senators Mike Crapo (R-ID), Olympia Snowe (R-ME) and Ron Wyden (D-OR).
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