Law Offices of John P. Connell, P.C.: On February 7, 2013, Massachusetts Congressman Richard Neal and another co-sponsor introduced a Bill in the House of Represenatives that is intended to stimulate the growing craft brewing industry in the United States. Known as the Small BREW Act (Small Brewers Reinvestment and Expanding Workforce Act), the new law proposes to dramatically cut the tax rate for breweries making 6 million barrels of beer a year.
If a brewery qualifies by its production numbers for this tax relief, the first 60,000 barrels of beer produced a year would only generate a federal tax of $3.50 per barrel; for the next barrel up to 2 million barrels the tax would only be $16.00 per barrel; and for barrels over 2 million per year the tax would be $18.00 per barrel. Under current federal law, brewers who produce fewer than 2 million barrels a year pay $7.00 a barrel on their first 60,000 barrels and $18.00 a barrel on every barrel thereafter.
The new three tier structure reflects the growing industry of craft brewing in the United States, which achieved more than a 5% share of the beer consumption market in the US in 2011 and continues to expand. It is estimated that if the Small BREW Act passes, it would provide craft brewers with an additional $60 million per year to expand their facilities and grow their workforce.
© Law Offices of John P. Connell, P.C., 2013.