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Fri January 13, 2012
Craft Breweries Push For Lower Taxes
It’s Friday, the end of the work week. This evening, a lot of people will head over to their local “watering hole” for relaxation with friends. In North Carolina a growing number of people are opting for a home-made beer, a craft beer. Micro-brew-style pubs are steadily opening. But in order to keep growing, they’re hoping for a tax break from Washington.
Leoneda Inge: It doesn’t matter the night of the week, there’s going to be a good crowd of folks at Fullsteam Brewery in downtown Durham. And it’s been open for only a year. There are dogs tied to stools, babies in strollers and a food truck outside for some snacks, to go with your home-made brew. Tom Simmons is here with his wife Rebecca and their four-year-old son Michael. Tonight he’s drinking the “Hog Wash” that has a hickory smoked taste to it.
Tom Simmons: Ummmm, we come here pretty regularly, at least a couple of times a week. It’s a very family-friendly environment which might sound kind of strange for a brewery but that’s part of the charm as far as we and a lot of families in the area are concerned.
There are more than 50 craft breweries in North Carolina today and more planning openings in the next few months. North Carolina law allows for micro and craft breweries to sell their beers on the premises. Some of the surrounding states aren’t that lucky.
Sean Lilly Wilson: Try the Paw Paw first.
Leoneda Inge: Okay. SW-A little on the sweeter side.
Sean Lilly Wilson is the CEO of Fullsteam, Chief Executive Optimist.
Leoneda Inge: Yes it does have a sweet taste and I like sweet.
The Fullsteam bar and brewery takes up about eight-thousand square feet. There’s another four-thousand square feet next door that’s used for storage. Wilson says they distribute beer to 100 restaurants, bars and stores in North Carolina, they have one account in Washington DC and they’re growing.
Sean Lilly Wilson: With that growth comes many challenges, we’re trying to keep up with the demand, we’re trying to get the ingredients necessary to keep making those beers. It’s not an easy business.
Wilson says what would help his establishment is if Congress passed the Small Brew Act. The legislation calls for cutting the excise tax by 50-percent for brewers who sell fewer than 60-thousand barrels a year. Fullsteam produces two-thousand barrels – and currently pays seven-dollars a barrel in taxes. So far both of North Carolina’s U-S Senators and nine of 13 house members have signed on to the Small Brew Act – including District 13 Congressman Brad Miller. Miller took a tour of Big Boss Brewing Company in Raleigh yesterday – and Natty Greene’s Brewing Company near Glenwood Avenue and Jones Street.
Rep. Brad Miller: North Carolina has a serious craft brew industry, small batch, artisan beers. And I’ve been learning about it this afternoon, I have been sampling their beers, I’ve spent an afternoon drinking North Carolina beer. It’s one of the many sacrifices I’m willing to make for my constituents.
Leoneda Inge: Tough job, tough job, but somebody’s got to do it.
Miller says it’s “cool” that North Carolina is one of the leading states for craft beers. And he hasn’t come across any macro-beer groups who are against giving the little guys a break. And there’s a big brew company in the 13th district. Miller-Coors Brewing Company has a plant in Eden.
Rep. Brad Miller: There are obviously huge advantages of being Miller you know, and competing against Big Boss or Natty Greenes. This would kind of even that up a little for them and make it easier for them to compete.
Miller’s host yesterday hopes the Small Brew Act gets some traction. Sebastian Wolfrum is director of Brewing Operations at Natty Greene’s. He says they brew some 10-thousand barrels a year, that’s 70-thousand dollars in taxes. He says he could do a lot with 35-thousand dollars if the tax is cut in half.
Sebastian Wolfrum: If I would have this money, I would pay somebody, I would buy more equipment. That money basically walks right out. Every time there is a little bit extra cash it gets reinvested because there is opportunity to grow your business. As long as there is no end in sight people will keep re-investing.
When it boils down to it,
craft brewing is another small business trying to create jobs in a tough economy.