Revised Senate Tax Reform Bill May Spell Tax Relief For Craft Brewers and Distillers

Although the status of Congress’ work on tax reform bills remains fluid in Washington, the revised version of the Senate’s bill may signal tax relief for craft brewers and distillers in Colorado and throughout the country. An amendment to the revised Senate bill would significantly lower federal excise taxes on craft brewers and distillers.

If passed in the present form and included in the final legislation, this tax provision would lower federal excise taxes as follows. Small brewers who produce less than 2 million barrels annually would see a cut from $7 per barrel to $3.50 per barrel for their first 60,000 barrels. Larger brewers would see a drop from $18 per barrel to $16 per barrel on their first six million barrels produced.

Distillers would also see tax relief as the current rate of $13.50 per proof gallon for the first 100,000 gallons produced would drop by nearly 80% to $2.70 per proof gallon. Other parts of the proposed legislation may reduce the tax impact on aged spirits.

If these tax cuts survive into the final legislation, the impact on the brewing and distilling community, especially small brewers, could be significant.