Washington, DC- Just days before the start of American Craft Beers Week, U.S. Senator Susan Collins has authored a bipartisan bill, cosponsored by Senator Angus King, that would stimulate regional economies nationwide with a reduction in the excise tax on each barrel of beer (one barrel is 31 gallons) brewed by small brewers. 

Under current law, brewers generally pay an $18 excise tax on each barrel brewed.  Small brewers, currently defined as those that brew fewer than 2 million barrels of beer a year, pay a reduced excise tax of $7 per barrel for the first 60,000 barrels of beer they brew each year. The Small BREW Act would reduce the excise tax applicable to brewers producing up to 6 million barrels per year to just $3.50 on the first 60,000 barrels and $16 on additional barrels below 2 million per year.

"Maine is home to dozens of unique craft breweries and brewpubs that invigorate our economy by providing more than 1,000 jobs and drawing countless tourists into our state," Senator Collins said. "In meeting with brewers across Maine, they always make clear to me how federal tax policy affects their businesses.  This bill, which I support, would help reduce the tax burden placed on many small brewers across our country, allowing them to thrive, create jobs, and further grow our economy."

"Maine has an incredible array of small, independent craft brewers that deliver world-class products and stable jobs," Senator King said. "By reducing the tax burden on our brewers, this important piece of legislation will give them a vital boost and enable them to further invest in their businesses and our communities - a winning combination that will create real jobs in Maine and across the nation."

"Maine's craft breweries are small independent family businesses, and demand for our beer is growing very quickly," said Daniel Kleban, President of the Maine Brewers' Guild and owner of Maine Beer Company.  "Every dollar we can reinvest in our business translates directly into more Maine jobs.  We are very fortunate to have representatives who are so supportive of our industry."

An economic impact study by Dr. John Friedman at Harvard University found that the bill would generate $153 million in economic activity in the first year and almost $865 million over five years and create nearly 4,400 jobs in just the first year. Maryland is home to 29 craft brewers, with at least 24 more in the planning stages. Maine has 36 craft brewers, with at least a dozen more in the planning stages.

The small brewer threshold and tax rate were established in 1976 and have never been updated.  Since then, the annual production of America's largest brewery increased from 45 million barrels to 105 million barrels.  Raising the ceiling that defines small breweries from 2 million barrels to 6 million barrels more accurately reflects the intent of the original differentiation between large and small brewers in the U.S.

American Craft Beer Week, May 13-19, is a weeklong celebration of America's small and independent craft brewers and their contributions to America's communities and our economy.

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