Hey, we know you’re busy, but today you should take a second to send a simple email to your Congressional leaders. It could end up saving you a whole buttload of money. In fact, someone already did all the work for you. Just fill out your contact info on this easy form to help make the Craft Beverage Modernization and Tax Reform Act permanent.
The Craft Beverage Modernization and Tax Reform Act (CBMTRA) has helped a whole lot of craft breweries keep their money in their businesses. Passed in 2017, CBMTRA created a two-year provision for Federal excise tax relief to craft brewers who produce fewer than two million barrels (bbls) annually, as well as other benefits and considerations for wine, distilled spirits and bigger brewers. But those tax breaks may soon be ending. From our previous article on the subject:
Due to the existing legislation sunsetting after December 31, 2019, Members of Congress have introduced a bipartisan supported extension of the current law — the Craft Beverage Modernization Act and Tax Reform Act of 2019. Expiring after December 31, 2020, the new CBMTRA would retain the current excise tax rate of $3.50 per bbl on the first 60,000 bbls for domestic brewers that produce less than two million barrels annually; 50 percent of the previous tax of $7 per bbl produced.
99 percent of U.S. breweries are estimated to fall into the “small domestic” brewer category and are slated to see their excise taxes double if the bill is not passed. For those checking their math, this increase results in an additional $210,000 of Federal excise taxes payable for a brewer producing 60,000 bbls annually. If we convert that into the simplified average craft beer price in my home state of Missouri, that equates to roughly 35,000 craft beers, or just over 5,800 six packs.
Additionally, CBMTRA sets the Federal excise tax at $16 and $18 per bbl for all other brewers on the first 6 million bbbls and over 6 million bbls, respectively.
That’s serious money, so everyone from brewers guilds to trade associations to trade websites (like this one) are urging all craft breweries to call, tweet and email their members of Congress to pass this bipartisan legislation. Leaders in the beverage alcohol sector are urging industry advocates across the nation to participate in a national Day of Action on September 9 (today).
“The nation’s craft brewers, distillers, winemakers and cider makers have been among the hardest hit during COVID-19,” said Mary MacDonald, executive director of the Ohio Craft Brewers Association. “Significantly increasing taxes on these small businesses even in normal circumstances would be devastating, but to do so during a pandemic would undoubtedly force many of them to close. Congress should give these businesses a fighting chance by passing the Craft Beverage Modernization and Tax Reform Act as soon as possible. Only then will breweries have the opportunity to recover from the harsh economic impacts of COVID-19 and be able to continue to support other vital industries in their communities.”
Introduced by Ron Wyden (D-Ore.) along with Senator Roy Blunt (R-Mo.) and Representatives Ron Kind (D-Wis.) and Mike Kelly (R-Pa.), the Craft Beverage Modernization and Tax Reform Act is uniquely bipartisan legislation with support from more than half of the U.S. Congress — the bill currently has 346 cosponsors in the House and 74 in the Senate. The legislation will make permanent reforms enacted in 2017 that create a fair and equitable tax structure for brewers, winemakers, distillers, cider makers and importers of all beverage alcohol.
“We need everyone’s help, from our brewers to allied trade partners, supply chain partners to Oregon craft beer-loving customers, to convince Congress this legislation is critical to the survival of our brewing industry and needs to be made permanent. It takes just a few minutes to help make a difference,” said Christina LaRue, executive director of the Oregon Brewers Guild, in a press release.