Misery. That’s my personal answer. The Beer Institute, however, argues that the most expensive part of a beer is tax. On average, 40 percent of the price paid for a beer is going straight to Uncle Sam and the state.
Now lobbyists in Washington are pushing to reduce those taxes, at least by a few cents. The Beer Institute is supporting legislation which would reduce the federal excise tax from $18 per 31-gallon barrel (an amount that doesn’t actually exist; a keg is 15.5 gallons) to $9 for large brewers. Smaller operations would pay nothing in excise taxes on the first 15,000 barrels they produce, while kicking in a mere $3.50 through 60,000 barrels.
The original excise tax dates back to the 1800s, when the U.S. government imposed a small, temporary tax to help pay for the cost of the Civil War. That tax became permanent in 1933, as a “sin tax” imposed in the wake of Prohibition.
In 1977, Congress reduced the excise-tax rate for small brewers producing fewer than 2 million barrels per year by $2. Over the next few years, the number of breweries began to tick up, until 1991 when Congress greatly increased the excise tax on larger breweries (to the current $18 rate), while leaving small operations alone. During that period, small breweries exploded across the U.S.
Further reducing the excise tax could lead to an even bigger influx of small producers, the Beer Institute argues, while providing larger operations like Anheuser-Busch and MillerCoors more room to grow. Lobbyists argue, passing the BEER Act would not only reduce the cost of beer, it would create jobs.
The Congressional Budget Office however is in favor of raising the excise tax, noting that the costs of alcoholism and alcohol-related incidents far exceed the revenue brought in by taxes on beer, wine, and spirits.
I hate taxes just as much as anybody and don’t believe non-alcoholics should have to pay the price for taking care of us that do or did have a problem with alcohol. But it is what it is as they say in AA. I do wish that the 40% collected as tax on beer was more targeted in helping people with addictions, instead of the other governmental needs it ultimately funds.