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Beer Wars in Washington

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ThatBrewDude  

Washington state is the 2nd highest market for craft beer behind California. As a homebrewer who desires to one day become a small business brewer, my heart aches knowing that the state of Washington is searching to raise revenue by taxing beer. Initially I read that it wasn’t to reach small businesses but the fact of the matter is that it does. It is going to bind people like me from creating a business, which in turn creates jobs and it will be exceptionally hard for those wanting to continue to keep their dream alive. Some of the biggest craft breweries in Washington should be fine, but they know that the smaller guys need to thrive to keep the community alive. The proposal was presented on April 10th, 2013 in Olympia, Wa at a press conference.

“Washington is believed to have the second highest market share for craft beer in the nation. Below are some statistics on why maintaining the small brewer tax rate at its current level allows for continued jobs production. Production data sheds light on the debate about equalizing alcohol tax rates among producers.

The Big 3 (Anheuser-Busch InBev, MillerCoors) employ around 25,000 people in the nation. Craft brewers employ over 100,000 people with only 6% of the market share. Which is a better investment in jobs growth? The current excise tax level is working. Washington breweries employed 3,499 people at the end of Q4 2011. Breweries are growing, expanding production facilities and adding jobs. Why lower the tax rate for multi-national breweries while raising it for homegrown Washington microbreweries, thereby cutting off the potential for job growth in a locally-owned and operated industry?

Equality in alcohol taxation: Anheuser-Busch inBev produced 99 million barrels in 2012 with MillerCoors following at 59 million. Together, The Big 3 produced 158 million barrels. Washington craft brewers, combined, only produced 293,716 barrels. 158 million : 0.24million. To suggest that craft beer be taxed at the same rate as the Big 3 is hard to understand when combined, we make up less than 0.19% of their annual production. There is nothing equal about our industries. They probably spill more beer on their floor than the volume of my brewery’s annual production (2,700 bbls). We are so insignificant compared to the amount of beer they produce; suggesting that there be tax equality between such a goliath and an itty-bitty microbrewery is astounding. They have economies of scale that we can not even begin to comprehend.

While an appreciated reduction, the current House proposal of a tax increase of $0.15/ gallon still almost doubles our tax rate. Is favoring multi-national corporations over at-home jobs growth really the message the Washington government wants to send to citizens of Washington?”

-Heather McClung President of the Washington Brewers Guild

Heathers statement meant to me that our state is saying they are all getting taxed “equally” and that the microbreweries will be fine just like the Big 3 will be. I truly do not see how they could think that way. The money that the breweries and the consumer will have to pay is pocket change to the Big 3.

I’ve grown to love the microbreweries in my state and especially love the way they give back to the community. We all grew up together and we help each other out. It is in our Washingtonian hearts to keep our friends, brothers, and sisters, blood or no blood, to all prosper on what we love and what we are passionate about. Craft beer will grow unfortunately, this will just slow it down, even turn some people such as myself away. We have to fight for what we adore and help each other out, whether your big or small, whether your Elysian or Wingman.

So do what you can to stop this or to make it stop, by promoting, sharing, and fighting the good fight in these Beers Wars.

“All our legislators claim to value the culture and entrepreneurial spirit of Washington’s small craft brewers, yet they propose a crippling, and unprecedented, tax increase that has not been adequately studied as to its longer term economic effect, both on the state budget and our small brewers.”

-Dick Cantwell Elysian Brewing Company
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