Oregon Senator Ron Wyden (D) has introduced a bill that would reform the federal tax on beer – a tax that has not changed since 1991. The current beer tax is $7 per barrel on the first 60,000 barrels for microbrewers (i.e., brewers who brew less than 2 million barrels per year). For microbrewers, after the first 60,000 barrels, the tax increases to $18 per barrel. Currently, all other brewers pay $18 per barrel from the first barrel of beer produced.

Wyden’s bill, introduced today, would reduce the excise tax rate from $18 to $16 per barrel for the first 6 million barrels brewed for every brewer, and reduce the tax rate to $3.50 bbl/year on the first 60,000 barrels for microbrewers (still defined as those producing less than 2 million barrels annually). Wyden’s bill synthesizes elements of two competing bills.

  • The Fair BEER Act, championed by the Beer Institute, a trade organization generally identified with big brewers, would change the excise tax rates on a graduated scale; $0 bbl/year for the first 7,143 barrels produced, $3.50 bbl/year for barrels 7,143-60,000, $16 bbl/year for barrels 60,001-2 million, and $18 bbl/year for each barrel over 2 million brewed.
  • The Small BREW Act, championed by the Brewers Association and craft breweries, would change the excise tax rates to; $3.50 bbl/year for each barrel up to 60,000, $16 bbl/year for barrels 60,001 to 1,940,000, and $18 bbl/year for each barrel over 1,940,000.

All bills would reduce federal excise tax rates for a beer industry that now numbers well over 3,000 breweries in the United States.