Economic Benefits

Economic Benefits from Graduated Federal Excise Tax for Small Brewers

An economic impact study by Dr. John Friedman of Harvard University on H.R. 494 and S. 917 found that the tax recalibration provisions would generate:

  • Over $183 million in economic activity in the first year
  • Over $1 billion over five years
  • Federal tax revenue would fall by $16.9 million in the first year and only $96 million over five years
  • Over five years, such recalibration would generate more than 5,000 jobs in the first year and an average of 400 jobs in each of the subsequent years

Potential Benefit

The following chart summarizes the potential benefit for the impacted barrelage tiers. Note that brewers over 60,000 barrels benefit at both the less than 60,000 proposed tax rate and the 60,000 to 2 million barrel tax rate. Brewers between 2 and 6 million barrels benefit for their barrels up to 2 million.

Barrels Total Barrels Total Industry Current Tax Total Industry Proposed Tax Savings
< 60K 9,280,084 $66,940,586 $32,480,293 $34,460,293
60 K – 2 M 16,138,352 $299,573,596 $266,287,641 $33,285,955
2M – 6 M 2,190,000 $39,420,000 $39,420,000 $0