A break for small brewers

Monday January 28, 2013

Craft brewers create good jobs and good beer, and are a growing part of the Berkshire economy. The bill co-sponsored by 1st District Congressman Richard Neal to give them an overdue break on excise tax payments will encourage their continued growth, assuming the giant American beer factories don’t employ their money and muscle to block the legislation.

Representative Neal’s bill, which is co-sponsored by Republican Rep. Jim Gerlach of Pennsylvania, will cut the $7 excise tax paid by small breweries on their first 60,000 barrels in half. To win over larger breweries, their excise tax on production of more than 60,000 barrels would be reduced from $18 to $16, and the number of barrels produced to qualify for the small-brewer rates would be raised from 2 million barrels to 6 million barrels. Currently, Massachusetts microbreweries pay roughly $1.3 million in annual excise tax based on a formula established in 1976 when microbreweries didn’t exist. Easing this burden would enable these small operations to expand and hire more employees, paying local economic dividends that should more than account for the lost excise tax.

The giant breweries, which will be pouring millions of dollars into ads during Sunday’s Super Bowl, have money and influence to burn if they don’t take kindly to the Neal-Gerlach bill. There is a reason why beer drinkers increasingly enjoy microbrews and it undoubtedly has something to do with the product of the beer giants, which is less designed to appeal to beer drinkers than it is designed so as not to offend them. In contrast, microbreweries throughout the nation and Berkshire County pride themselves on their distinctive appearance and taste.

Two years ago, the Alcoholic Beverage Control Commission decided that Massachusetts microbreweries should be required to get at least 50 percent of their beer-making ingredients from Massachusetts farms, an impossibility given the difference between Massachusetts and, say, Germany. Wide protests and legislative action ended this threat to the microbreweries’ licenses, but big regulators, like the ABCC, tend to take actions that are friendly to the big companies they regulate, not the little guys. That may be the biggest threat to the wise and fair proposal to be made next month by Congressmen Neal and Gerlach.


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