|Nah, I'm talking about taxes, money, dollars|
To insulate the state's craft brewers, the Leg exempted them from the tax. Brewers selling more than 60,000 barrels a year were stuck paying it; little guys weren't. Since that time, the big guys have been shelling out $23.58 per 31-gallon barrel. Small brewers have been paying $4.78.
Part of the issue here is that the tax on beer is about all that's left of the 2010 tax package. The soft drink companies spent $16 million to pass an initiative that wiped out the tax on soda and water. The beer industry likely would have done the same thing, but they were busy trying to scuttle the liquor privatization initiative...which passed with disastrous results for Washington consumers. But never mind. That's another messy story.
A couple more things about the beer tax:
- First, it will apply to all beer sold in Washington. It will certainly cut into the profit margins of in-state craft brewers. Beer from states like Oregon, where the per barrel tax is low (8 cents per gallon, $2.48 per barrel) will be taxed at the higher rate when sold in Washington. Distributors will pay the tax, which will be passed on to consumers in the form of higher prices.
- Second, big guys won't feel the impact of this tax. That's because they spread their tax burden around. Since tax rates vary around the country, the big guys simply suck it up and subsidize sales in states with high taxes with the extra money they make in low tax states. That's why Washingtonians haven't seen a spike in macro prices since 2010...and likely won't see one if Inslee gets his way.
|Stick around...it's early|
Washington craft brewers are wondering how this happened. They're thinking they've never been so insulted. Hey, stick around...it's early.
State excise tax rates on beer are here.