DRAFT Magazine

Oregon is one of the world’s most recognizable beer destinations, a fact you probably know. It’s also a state, like many others, that’s run into a finance problem. Sadly, a few lawmakers in Oregon believe they’ve found a solution — a proposed beer tax that is absurd. I’ve read the bill and in it there are a few points that are meant to gain the support of Oregon voters and lawmakers. What are the reasons Oregon needs a massive increase in its beer tax? I’ll try to summarize (feel free to read the real bill though and tell me if I’m far off).

• Oregon has a low beer tax when compared to the rest of the country
• Taxes haven’t been raised in a long time
• Oregon has high social service costs that can be linked to substance abuse
• Oregon needs more substance abuse programs
• More taxes make it hard for kids to get alcohol
• Oregon has a lot of underage drinkers

Where to begin? Oregon does have a low beer tax when compared to the rest of the country, but the state also has one of the most robust beer industries in the nation. Am I the only one that sees a correlation? I’m no scientist or statistician, but I can look at sites such as BeerMapping.com and see that Oregon has a plethora of breweries, more than Washington, Idaho, and some other nearby states. That said, if there is an actual need to raise taxes, in what world does a 2008% increase make sense? Oh, did I forget to mention that? Yeah, the proposed tax amounts to a 2008% increase.

Next, I don’t think anyone is going to argue there is a lot of underage “drinkers” in the state of Oregon, or any other state. That said, most studies that are commonly referenced suggest that the alcohol of choice for underage drinkers is liquor and wine — not beer. Why then is this tax for malt-based beverages alone? Moreover, social service programs that treat addiction serve a population that is addicted to alcohol in general, along with drugs. Again, why only tax the beer industry?

The tax initiative is short-sighted and does nothing to actually help Oregon fight its underage drinking and addiction issues. A new beer tax won’t keep alcohol out of kids’ hands and isn’t a fix-all for the state’s financial woes. I know the Oregon Brewers Guild members will be fighting hard to keep beer taxes fair in the state, but I imagine they could use some help from fellow residents to make their points known to the lawmakers.

I spoke with some Oregon craft brewers about the issue and it came as no surprise that they’re rallying to put up a fight. According to Darron Welch of Pelican Brewery, this proposed tax increase “would take Oregon State’s excise tax from one of the lowest in the country to the absolute highest.”

Jamie Floyd, owner and brewer for Ninkasi Brewing in Eugene has further concerns. “This is being promoted as a 15 cent beer tax, but it’s not,” he says. “Oregon doesn’t have a sales tax.” He continued, saying it’s a business tax levied on Oregon brewers that will be passed along to wholesalers who will pass costs along to retailers, meaning consumers could see dramatic price increases for their pints and bottles of beer. Floyd and other Oregon brewers currently pay around $2.60 in state excise tax per barrel of beer (31 gallons). Under this proposal, Ninkasi would pay more than $52 per barrel! Put another way, this is the equivalent of paying one full-time employee for every thousand barrels of beer produced. “And that’s just the State’s excise tax, we still pay regular business taxes as well as Federal taxes,” Floyd says.

Clearly the brewers in Oregon aren’t taking this lying down. On February 5, a host of brewers and industry members are driving to Salem (Oregon’s capitol city) to talk with lawmakers and make them aware of the horrific impact this tax would have on one of Oregon’s more successful industries. As Welch puts it, “What we have in Oregon is a healthy industry — Oregon is short on healthy industries.”

I urge beer enthusiasts to do their part to help out. If you’re an Oregon resident, we at DRAFT implore you to take a moment to contact your state representative — by phone, email, letter, or appointment. Let them know this is a bad solution for the State. If passed, brewers could be forced out of business — at minimum, programs for employees (health insurance, 401k matching, etc.) would be cut. If you’re not certain who your rep is, talk to a brewer next time you’re in and find out — while filling your growlers or just sipping a great pint, of course.