Senators Murray and Cantwell step up in support of local brewers

The Washington Beer Blog wants to extend our thanks to Senator Maria Cantwell and Senator Patty Murray, both of whom recently became cosponsors of Senate Bill S.3339. In doing so, Cantwell and Murray join Representative Dave Reichert and Representative Jim McDermott, both of whom are cosponsors of the bill in the House of Representative. The corresponding bill in the House of Representatives is H.R. 4278.

For background information, read our previous posts on this issue.

This bill gives a small excise tax break to the nation’s smallest brewers. Currently, a brewery that produces less than 2 million barrels of beer per year pays $7.00 per barrel on the first 60,000 barrels produced each year. For the most part, the local craft beer producers that you know and love produce less than 60,000 barrels per year. Most of them produce nowhere near that much beer. Reducing the tax rate to $3.50 per barrel would provide approximately $18.0 million per year to help strengthen our nation’s smallest brewers and support their efforts to maintain and generate jobs.

The estimated cost of the provision is about $44 million per year and less than $500 million over 10 years. A Harvard study of the Economic Impact of H.R. 4278 indicates that the bill would generate more than 2,700 new jobs over the first year to 18 months, followed by an average of 375 new jobs per year over the following 4 years. Each new job would cost less than $4,000 in foregone government revenue in 2010. According to the study, “Economic activity would increase by $10.91 per dollar lost in government revenue, making the bill an efficient use of government funds.” (Read the study)

What does that mean? It means that smart people who study these things think it is a good idea. This bill updates a tax code that was written back in the 1970s when the country had virtually no craft beer industry and the only breweries that existed were the ones producing millions of barrels of beer each year. This revision to the excise tax code is long overdue.

If you would like to thank Senator Murray, click here.
If you would like to thank Senator Cantwell, click here.

The thank you messages that I sent to each of our sentators was very simple: “Thank you for stepping up and becoming a cosponsor of S. 3339. Thank you for supporting our state’s vibrant craft brewing industry. Please continue to help push this legislation through congress.”

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