- The legislature is considering various versions of excise taxes--fees that are charged to the brewer, rather than the distributor or retailer.
- One version of the legislation (which has been to the legislature before) would raise the tax to $34.60, a $32-per-barrel hike over the current rate of $2.60. A barrel is 31 gallons, so the per-gallon increase would go from eight cents to $1.12.
- The national mean (average) for the beer tax is $7.75 per barrel, and the median (half pay more, half pay less) is $5.25.
- Some of the legislation is tied to the Consumer Price Index, which increased 31.8% between 1994 - 2005. However, over the same period, beer prices only increased 23%. Therefore, the tax grows in proportion to the cost of production over time.
- Some of the legislation would exempt all breweries who sell less than 125,000 barrels in Oregon. Currently, no brewery sells that much, but in less than a decade Deschutes, Widmer, and Full Sail could. At 125,000 barrels, a brewery's sales would account for just 4% of the beer sold in Oregon. But on the day a brewery hit the magic number, its tax would go from $845,000 to $4.325 million.
When our home-grown Oregon brewers whip up a barrel of beer, a lot of people make money on it. The brewers sell it to distributors who take a cut, and the distributors turn around and sell it to retailers, who sell it for four bucks a "pint" (more lucrative than it looks), getting their cut. Yet the tax being considered tomorrow will only affect the brewer. Legislators are doing their best to make sure it mainly affects out-of-state brewers like Bud. But it is worth asking the question: why do you need this tax, and why are you targeting breweries?
Good points.
ReplyDeleteI called my rep, Sara Gelser, and asked she votes against it. I linked to a previous article of yours too recently.
what are beer taxes like in Washington? meaning, if we institute this ridiculous tax here, how many Portland breweries are going to move to Vancouver?
ReplyDelete