5 Comments

  1. Jim B.
    January 15, 2013 @ 8:57 am

    Great read. I shared this with my colleagues this morning and they too enjoyed. Keep up the good work.

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  2. Joe
    January 15, 2013 @ 7:44 am

    I think you meant $16, not 16%. Corporate income tax is not a tax on beer, it’s a tax on income. Because the business sells beer doesn’t mean that it’s a tax on beer. By extension, that would mean that all goods are taxed through the income tax, and that is an oversimplification of the tax code. I agree with you on excise and sales taxes, but income is a big stretch. We are in agreement, however, on your overall message: this proposal would be bad news for the brewing industry, particularly micro and nano breweries.

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  3. Katie
    January 14, 2013 @ 10:56 pm

    Good catch on the tax rate, Joe – 16% is the correct percentage.

    As a corporate tax accountant, I can assure you federal income taxes are imposed on brewer’s income. For example, Sam Adams, a publicly traded brewery, recorded an effective income tax rate of approximately 36% for 2011 (I am still awaiting the 2012 financial results). Applicable state and local income taxes vary depending upon jurisdiction. Also, a shareholder may be subject to a secondary level of income tax (aka double taxation) on investment income (such as dividends or gains on sale of stock).

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  4. Joe
    January 14, 2013 @ 9:11 pm

    There appears to be a slight error in the hypothetical per-barrel tax rate on 5% ABV beer. According to the cited proposal, the rate would be $16 per proof gallon – not the $19 the author uses (it’s a 19 percent increase, which could be the source of the confusion). That would make the 31-gallon barrel tax rate $49.60, not $58.90. Still, over seven times the current rate (for the first 60,000 barrels for brewers brewing under 2 million barrels). Also, beer is not taxed via the income tax.

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  5. Bryon Lape
    January 14, 2013 @ 4:59 pm

    Good grief. More BS ways to tax everyone for everything. How about they cut the damn spending? What’s next? Taxing homebrew once made?

    Reply

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