Brewers hope to lower TN beer tax, the nation's highest
NASHVILLE, TN (WSMV) -
Taxes can be a touchy topic, even over a cold beer. Many breweries and loyal customers from across the state are meeting Wednesday in Nashville to discuss a plan to change the beer tax in Tennessee and what it might mean for customers.
Tennessee has the highest beer tax in the country. The current law dates back to the 1950s, and a growing number of people - both customers and brewers - think it could be time for a change.
"Nobody in Tennessee wants to be known as having the highest taxes in the country. That's not good business. That's not good policy," said Linus Hall, founder and brewmaster at Yazoo Brewing Company.
That tax currently stands at 17 percent for wholesalers, which is in addition to separate federal and state taxes per barrel.
"The craft industry - nationwide and in Tennessee - is beginning to grow and has been for a number of years now. And this tax is placing a burden on those businesses. It taxes their products higher than any of the other beers out there, because of the price points on it," said Rich Foge, with the Tennessee Malt Beverage Association.
Tuesday, Two lawmakers filed The Beer Tax Reform Act. It would modernize the law without lowering the tax benefit for local governments.
Instead of the 17-percent tax, wholesalers would pay a flat $34 tax on each barrel. It would still bring in about $125 million every year, and for Foge it treats every company and every beer the same.
"It's a perspective bill. It's not going to change anything," Foge said. "We'll still be the highest beer tax in the country. But then going forward, it won't grow at this astronomical rate. And that's the benefit to the consumer and to the businesses."
The idea makes sense for a businessman like Hall, hoping to solve a perceived problem to keep his family business in the family.
"It does. And I can't really think of a logical argument against it," he said. "I see - 10 years from now - if we don't change this, you know, what kind of business am I going to be leaving for my children? Is it even going to exist?"
It's important to note Yazoo hasn't been the only company to step forward in support of this tax change. More than 20 companies stepped on board, including major companies like Anheuser Busch and Miller Coors.