Hefty increase in beer tax proposed, criticized

By ANTHONY HARVEY
Capital News Service
LANSING – Critics say that a recent proposal to increase the tax on beer is unlikely to get much support from businesses.
The bill comes as the craft beer industry is booming in Michigan.
“I did not sign on to change horses in the midrace when I started my business,” said Matt Greff, owner and operator of Arbor Brewing Company in Ann Arbor.
Greff said craft beer brewers and those trying to capture a piece of this market would be severely crippled by the tax.
There is an existing tax climate when entrepreneurs start news businesses.
“These craft beer businesses are simply not equipped to handle the financial burden of such a dramatic increase,” Greff said.
Rep. Thomas Hooker, R-Byron Center, proposed a tax increase from $6.30 to $21.70 a barrel. That would increase wholesale prices, and in turn, would be passed on to customers.
The tax would mean an additional five cents for a 12-ounce glass. Hooker plans to use the revenue to fund programs to reduce alcohol-related violence.
“This tax is a terrible idea with this increase of almost 250 percent,” said Scott Graham, executive director of the Michigan Brewers Guild. “Increasing it further does nothing but harm the craft beer economy.”
A proposed alcohol tax increase is not a new idea for Michigan.
“We’ve been having the conversation about excise tax on beer and alcohol for at least five or six years,” said Marie Hansen, the business manager of Michigan Alcohol Policy Promoting Health and Safety. “There are so many costs associated with alcohol-related violence anytime police departments or hospitals are involved. Some form of control should have been in effect.”
The bill is in the House Regulatory Reform Committee. Its chances are unknown but Hooker is up for re-election this November.
“The bill is absolutely ludicrous,” Greff said. “(Hooker) is trying to push his idea of alcohol consumption control through this bill. But this is not the way to go about it.”