Our local U.S. Senator Charles E. Schumer (D-NY) is supporting legislation that would cut the excise tax on small breweries by 50% and we’re supporting him.
According to Schumer’s website, the beer industry supports nearly 60,000 jobs in New York and cutting taxes for 65 small brewing operations will allow these businesses to hire more employees, expand their businesses and revitalize downtown communities.
Image credit: troyrecord.com
Currently these brewers pay a $7 excise tax on each barrel they make each year, when they brew up to 60,000 barrels. Under the BEER Act that Schumer will introduce, that rate is slashed to $3.50 per barrel, which amounts to potential savings of $210,000 per year. Additionally, the bill cuts the tax by $2 on the next 1,940,000 barrels produced, which results in potential savings of $3,880,000 each year.
Schumer is quoted as saying, "Breweries are the crown jewels of so many of our communities, and many of them have renovated charming old warehouses in downtowns across the state. Putting more money back into these businesses will be good for economic development, good for jobs, and good for New York."
The legislation was introduced last Congress by Senator John Kerry (D-MA), and earned 27 cosponsors and broad bipartisan support. The approximately 650 small breweries across the country combine to employ nearly 100,000 American workers. In New York, the beer industry directly supports approximately 8,000 jobs through brewing and distribution, and nearly 60,000 jobs overall when retail sales are factored in. These jobs paid nearly $1.7 billion in wages in 2008, and accounted for almost $5 billion in economic activity.
A Harvard study of the proposal predicts that passage would increase economic activity in the small brewery sector by over $115 million in the first year, and by over $733 million over the first five years. Every dollar saved by cutting the excise tax would result in nearly $11 dollars in economic activity, providing an immediate and substantial boost to the economy. According to the study, the proposal would generate over 2,700 new jobs in the first year, and an additional 375 jobs per year for the next four years.
Sounds like the beer industry is slated for more growth and we couldn’t be more excited.
[techtags: BEER ACT, SCHUMER, TAX CUTS, BEER INDUSTRY]