Tennessee, by far, charges the highest tax on beer in the country. On average, $37 per barrel is paid in tax before the beer hits the store shelf or bar. Touching Tennessee, Alabama gets about $32, Georgia $30, then Kentucky is next at $23. The lowest in the region are Arkansas at $7, and Missouri at only $1.86 per barrel.
If that isn't bad enough for Tennessee consumers, one of the three taxes charged is based on the price of the beer, not on volume sold. Only Tennessee and Kentucky tax in that manner. As a result, beer sales have declined by about 5 percent during the past ten years, while tax revenue has increased over 32 percent.
A funny thing, sort of, is if you look at the distribution map of the great Bells Brewery in Kalamazoo, Mich., it includes basically every state east of the Mississippi, except Tennessee. Same with Founders Brewing from Grand Rapids, Mich.
Then we can look at the issue of Sierra Nevada. They considered building a new production facility in east Tennessee, but chose Asheville, N.C. instead. North Carolina collects only $19 per barrel in tax. New Belgium and Oskar Blues put production facilities in Asheville as well.
Making matters worse, think about which beers are the most expensive, meaning the highest taxed. Craft beer. While $37 is the average paid, small brewers like Yazoo and Jackelope here in Nashville pay more like $57 per barrel according to Linus Hall, owner/founder of Yazoo Brewing Co.
So, what can be done? Let's first look at the Tennessee Craft Brewers Guild, www.tncraftbrewers.org, a group of 18 small brewers throughout the state. It was founded to protect and promote craft brewing and breweries.
Recently they have created the group Fix the Beer Tax, www.fixthebeertax.com. Working with Rep. Sexton of Crossville, who introduced the Tennessee Beer Tax Reform Act of 2013 in the legislature, they have sponsored two huge rallies to raise awareness of this job killing, costly tax.
The first event was here in Nashville, at the Yazoo Taproom, with about 300 in attendance, including all the beer distributors. The next was Memphis, with Knoxville tonight Feb. 15.
So, if you don't like high, unfair, job killing taxes, and you like craft beer, check out the Fix the Beer Tax website. There, you can find more information, and a link to contact your local representative about the issue.
See you at the pub. Cheers!
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