Beer Fight Brewing Over Taxes.

If enacted, the Small BREW Act would cut the federal excise tax on beer from $7
 a barrel to $3.50, which is placed on a small brewer’s first 60,000 barrels produced per year.

There’s a tax fight brewing between large beer companies and their smaller craft brethren on Capitol Hill.

The Beer Institute, which includes member companies such as Anheuser-Busch and MillerCoors, plans to “actively oppose” the Small Brewer Reinvestment and Expanding Workforce, or Small BREW Act, this year.
The Brewers Association — essentially the trade group for craft brewers — is lobbying for the bill, which would reduce the federal excise tax on beer from small producers.

Chris Thorne, vice president of communications for the Beer Institute, says his trade group has dropped its neutral stance on the legislation because it divides the industry.

“We are going to actively oppose this legislation,” Thorne said. “If the entire industry is unified and has one ask, we stand a far better chance of succeeding than when we have multiple bills to push.”

Thorne said his group opposes any tax increase on beer, but that all of the industry should unite behind one bill: the Brewer’s Employment and Excise Relief (BEER) Act, which is expected to be introduced later this year and would reduce excise taxes on beer produced by brewers large and small.

Bob Pease, chief operating officer for the Brewers Association, said the Beer Institute has been uncomfortable with his group’s preferred legislation in the past.

“That’s disappointing but not altogether unexpected,” Pease said. “They expressed discomfort in the past about various components in the bill so that’s why it doesn’t come as a total shock.”

If enacted, the Small BREW Act would cut the federal excise tax on beer from $7 a barrel to $3.50, which is placed on a small brewer’s first 60,000 barrels produced per year. After that initial 60,000 barrels, small brewers must pay $18 per barrel, which would be lowered to $16 under the bill.

In addition, the bill would expand the tax code definition for a small brewer. Right now, brewers who produce up to 2 million barrels of beer per year are considered small brewers. The legislation would raise the limit to 6 million barrels per year.

The Beer Institute said the bill amounts to a “giveaway” for a handful of profitable brewers.