Lotte Peplow, the Brewers Association’s American Craft Beer Ambassador for Europe, applauds a significant achievement in the American craft brewing world
Photograph: Nic Crilly-Hargrave
This month, I want to highlight a huge achievement that has recently been made possible by the hard work and dedication of the Brewers Association on behalf of all small and independent American craft brewers.
Securing permanent federal excise tax recalibration for small brewers has been a top priority for the Brewers Association since 2009. Advocacy at local and federal levels by the association has helped demonstrate the important role that the brewing industry plays in America’s economy.
Initial success came in December 2017 when US Congress temporarily included language from the snappily titled Craft Beverage Modernisation and Tax Reform Act (CBMTRA) in the Tax Cut and Jobs Act. This recalibrated the federal excise tax for breweries from $7 to $3.50 on the first 60,000 barrels for domestic brewers producing less than two million barrels annually. There was a reduction from $18 to $16/barrel on the first six million barrels for all other brewers and all beer importers. Breweries were also able to transfer beer between bonded facilities. The provision was scheduled for two years and extended another year in December 2019.
Then, on 27 th December 2020, the president signed into law a year-end legislative package that included targeted covid-19 relief and language from the CBMTRA, making the existing federal excise tax rates for small and independent breweries permanent.
By including the CBMTRA, congressional leaders acknowledged the profound impact the reduced excise tax rate has had on the growth and trajectory of a uniquely American industry, recognising that allowing the lower rates to expire would be extremely detrimental to the 8,300 small breweries, brewpubs, and taprooms across the country. The passage of CBMTRA represents annual savings of $80 million for craft breweries.
Pre-covid, American craft breweries employed more than 160,000 workers at their breweries, including related industry roles, and the total impact was 580,000 jobs. The economic impact of the brewing industry surpassed £82 billion in 2019. Congress overwhelmingly supported the lower federal excise tax rates, with more than half of Congress co-sponsoring the CBMTRA, including 77 Senate and 351 House co-sponsors.
The Brewers Association has worked tirelessly to secure this piece of legislation, which will provide certainty and continued savings. Bob Pease, president/chief executive of the Brewers Association, and Katie Marisic, federal affairs director, led the charge.
All credit to those two, but the state guilds and thousands of breweries across the country should also give themselves a hand. This feat was accomplished thanks in large part to breweries’ participation
in hill climbs, co-ordinated grassroots days of action, and direct contact with their elected officials. However, there is still work to be done and the Brewers Association is continuing to advocate for additional covid relief for member breweries.
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 5,400 US breweries. The BA’s independent craft brewer seal is a widely adopted symbol that differentiates beers by small and independent craft brewers.
The BA organises events including the World Beer Cup, Great American Beer Festival, Craft Brewers Conference and BrewExpo America, SAVOR: An American Craft Beer and Food Experience, Homebrew Con, National Homebrew Competition and American Craft Beer Week.
The BA publishes The New Brewer magazine, and Brewers Publications is the largest publisher of brewing literature in the US.
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.