Passage of Craft Beverage Modernization and Tax Reform Act before year-end expiration vital to small business health.
COLUMBUS, Ohio – Leaders in the beverage alcohol sector are urging industry advocates across The U.S. to participate in a national Day of Action on September 9 by asking their members of Congress to pass the Craft Beverage Modernization and Tax Reform Act, S.362/H.R. 1175 (CBMTRA).
On December 31, 2020, the recalibrated Federal Excise Tax (FET) rates for 347 small and independent breweries in Ohio will expire. These small businesses are asking Congress to prioritize and pass the Craft Beverage Modernization and Tax Reform Act and make the current FET rates permanent. Since its enaction at the end of 2017, the reduced FET has enabled small and independent brewers across our state to reinvest in their business, hire new employees, and grow their breweries. Without action from Congress, America’s more than 8,300 breweries along with beer importers will face a nearly $154 million annual excise tax increase beginning in January 2021.
“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 Senators Ron Wyden (D-Ore.) and Roy Blunt (R-Mo.) and by 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.
“The Craft Beverage Modernization and Tax Reform Act has been crucial to the success of small and independent brewers in Ohio and needs our full support,” added MacDonald. “The craft beer industry has experienced sustained growth in Ohio and across the country and the current FET rate has gone a long way to empower our brewers to make significant investments into their businesses. Breweries operate in every state and nearly every congressional district in the country and if the current rate is allowed to expire, the tax increase will have a devastating effect on these businesses. The beer industry is one of the jewels of America’s manufacturing sector, supporting more than 2.1 million jobs —559,545 of which come from the craft industry.”
Recalibrated FET rates have saved the American craft brewing industry nearly $80 million annually and helped provide certainty and stability for more than 8,300 breweries across the country, including 347 in Ohio. If the legislation is not acted upon, American and Ohio brewers alike will face a massive financial burden. More than 2,000 new brewers who have only been in operation since Jan. 1, 2018 and have never before paid the tax will see a 100 percent tax increase.
“We need everyone’s help, from supply chain partners to loyal customers, to ensure Congress makes this legislation—which is critical to the survival of hospitality businesses across the country— permanent. It takes just a few minutes to make a difference for these businesses in our communities,” said MacDonald.
Day of Action participants are encouraged to call, tweet, and email their members of Congress to pass this bipartisan legislation. The Brewers Association and Ohio Craft Brewers Association have set up a convenient form to contact legislators about this issue: https://p2a.co/XRg1il2.
About the Ohio Craft Brewers Association
Founded in 2007, the Ohio Craft Brewers Association is a nonprofit guild that exists to promote, preserve and unify Ohio’s craft brewing industry. We aspire to be recognized as the industry leader at both state and national levels for preserving the art of making high-quality, unique craft beer; to serve as the unified voice for craft brewers across the state; to advocate on behalf of the Ohio craft beer industry; to contribute to systemic, local community development by driving economic and job growth, while creating experiences that bring people together; and to serve as a beacon for local production and manufacturing through craft beer, resulting in diverse choices for consumers.
About the Brewers Association
The Brewers Association (BA) is the not-for-profit trade association dedicated to small and independent American brewers, their beers, and the community of brewing enthusiasts. The BA represents 4,800-plus U.S. breweries. The BA’s independent craft brewer seal is a widely adopted symbol that differentiates beers by small and independent craft brewers. The BA organizes events including the World Beer Cup®, Great American Beer Festival®, Craft Brewers Conference® & BrewExpo America®, SAVOR™: An American Craft Beer & Food Experience, HomebrewConTM, National Homebrew Competition, and American Craft Beer Week®. The BA publishes TheNew Brewer® magazine, and Brewers Publications® is the leading publisher of brewing literature in the U.S. Beer lovers are invited to learn more about the dynamic world of craft beer at CraftBeer.com® and about homebrewing via the BA’s American Homebrewers Association® and the free Brew Guru® mobile app. Follow us on Facebook, Twitter, and Instagram.