Beer Stimulus?

A new bill introduced in the House of Representatives would lower the excise tax on craft breweries. It was introduced by a bipartisan group of eight Reps, including Oregon's DeFazio and Blumenauer. Details:
  • For breweries producing less than 60,000 barrels, the per-barrel tax would drop from $7 to $3.50
  • For larger breweries, the tax on all barrels produced between 60,000 and 2 million would be taxed at $16, rather than the current $18.
  • All barrels over 2 million would be taxed at $18 per barrel.
This is an update on the 1976 small-brewer tax rate, one that has never been adjusted. It targets only the federal excise tax, not state taxes.

For an idea of how this would affect breweries, here are some calculations I made for various sizes of breweries:
5,000 Barrel Brewery
Current law: $35,000
HR 4278: $17,500

30,000 Barrel Brewery
Current law: $210,000
HR 4278: $105,000

75,000 Barrel Brewery
Current law: $690,000
HR 4278: $450,000

150,000 Barrel Brewery
Current law: $2,040,000
HR 4278: $1,650,000
Although it's not embeddable, there's a great news video from Colorado describing the legislation here. A pdf of the legislation is here.

The Brewers Association favors it, and no doubt all breweries do, too. This could add up to tens or hundreds of thousands of dollars to a brewery or brewpub. However, the policy wonk in me wonders why we'd be lowering taxes on small breweries now. It's a tiny drop in the bucket to the federal budget (costing the government just a hair over $40 m). But of all the sectors of the economy that could use stimulating, craft brewing seems like the last in a very long line. Some breweries have no doubt suffered in this economy, but as a whole, craft breweries continue to grow and prosper. The idea of federal stimulus is to get stalled industries moving. Any job's a good job, and this will definitely create jobs, but should we be handing out tax breaks to a healthy sector when others are dying on the vine?

But hey, don't let me be the diacetyl in the beer--this would be good for Beervana if it passes.

Hat tip to JG for flagging this down and emailing me the news.