Oregon HB2641

Rob L of the Oregon Brew Crew posted this to our listserv in a conversation about a new beer tax proposed in Oregon. He makes a number of lucid points. And doesn’t just complain but proposes action.

Oregon HB2461 surprised me. Actually, at first it was shock, then
disbelief and anger. Now I’m ready to do something about it.

Jim P wrote:
> Cost of producing each keg (tax is production cost) would go up $25.
> Average distributor markup is 20-30 percent. Average pub markup is
> 300-350 percent. You get 100-120 pints per keg. You can do the math.

Not everyone finds it easy to do the math, so here goes:
$100 keg today, about $1/pint
$1.30/pint from wholesalers
$4.00/pint at a pub

After the punitive “death to local beer” tax (using same markups):
$125/keg, or $1.25/pint
$1.63/pint from wholesalers
$5.00/pint at a pub

All of a sudden, that “15 cents a bottle” sounds downright misleading, when realistically it is an extra $1 for your pint!

Yes, raising taxes will reduce access to beer for kids; in fact, that 25% price hike will reduce access to beer for many adults, as well. In fact, this is already an extremely challenging time for the brewing industry, and it would likely drive a significant number of local breweries and pubs out of business.

If the problem is insufficient money for particular services, instead of proposing these punitive taxes that would throw more people out of work during the 2nd biggest recession in 200 years, then from the $140 million in “alcohol taxes” already being levied, why is less than 6 percent going to substance abuse treatment and prevention? Why not simply amend the bill to fund those services from the taxes already collected for that purpose?

If the authors of this bill actually have the well-being of high school youths as their primary concern, then they should recognize that most of the industrialized world allows drinking at age 16 (or so), and those countries have lower incidences of alcohol and drug abuse. They should provide sources for their outlandish claims such as “half of the students in every 11th grade classroom in Oregon drink” (really–in the classroom? Heck, not even half my adult co-workers drink!). And where is the causality — the connection between “having a beer” and having a “chronic, relapsing brain disease”? Beer is the healthy alcohol beverage of moderation. It just doesn’t make sense.

It also doesn’t add up economically.

Breweries and wineries in Oregon are locally-managed, world-class, family-owned, high-employment, tourist-attracting businesses. If we want to cripple our local economy because some businesses make products which might be mis-used, why are we only taxing beer? Should we also be taxing the local wineries and micro-distilleries? Isn’t obesity a leading health concern — should we be taxing our cheese, fruit, and filbert industries out of existence, too?

No! Oregon is famous for these specialty products, often hand-crafted or grown by businesses which often operate on thin margins; yet these historic mainstays of our economy could too easily be closed by sudden, thoughtless, extreme government over-taxation like this. I want Oregon to be a place that we’re proud of, and when tourists from all over the world come to the “Oregon Brewers Festival” — drawing over 70,000 people — it seems like our internationally renown breweries must be doing something right; something to be encouraged, not penalized.

Forcing draconian economic neo-Prohibitionism on our local world-class breweries, with built-in yearly escalating penalties, is short-sighted and misguided for our kids, our economy, and the standing of Oregon in the eyes of the world.

I love good beer, I love to share good beer with friends, and I believe responsibly enjoying good beer should have a greater role in our society.

I love Portland in part because of great (amazingly delicious!) beer, good biking and hiking, good coffee, wonderful food, nice wineries, beautiful rivers, the mountain and ocean nearby. We have great public spaces like museums, music, theatre, lovely parks, bookstores, brewpubs, and coffee shops. The casual wonders of our city are reflected in the people — we are generally the most polite, friendly, nice bunch of folks you could find.

I want to keep and cherish these things. If this bill was about creating a 2000% coffee tax, or taxing bike and parks usage, or driving local bookstores out of business, I think a huge number of us would be angry about those things, too, because they are special to us.

So what are we going to do about it? Well, I’m going to:

1) Write my state senator and state representative.

http://www.leg.state.or.us/findlegsltr/

2) Encourage my friends to “speak up, if you don’t want beer taxes
to increase 2000 percent, about $1/pint, if HB2461 passes”.
I’ll offer to let them join me in taking action, too.

3) Volunteer for Zwickelmania on Saturday Feb 14th, to help
publicize this misguided government attempt to destroy
our local “good brewery” culture, and those good jobs.

4) Keep homebrewing, stay active in the Oregon Brew Crew, and keep
my ears open about other ways we can help prevent this disaster.

And finally, I’m going to relax and have a beer. A delicious local beer. Like none other in the world, brewed just a few miles from my house; at a brewery open for all to visit. And I’m going to smile, because I firmly believe that by working together, we are going to find a way to prevent a catastrophe like Oregon HB2461 from happening this year. And if we’re really, really smart we might even find a way to introduce legislation to prevent this ridiculousness from happening in the future, as well. And all that time, my friends and family, you and I, will have the pleasure of living in one of the best places on earth.

>> To Oregon’s fresh, local, delicious, healthy BEER! <<

Cheers and Prosit,
Robert L

  • Josh

    The biggest problem with your math is that the real problem is with the end seller. When they put a gas tax or sales tax on an item it is taxed at the end user so you see a small amount of change.

    Your math assumes that the pubs will raise the prices the same percentage. I really doubt any pub would raise the price that much. All they have to do is just put the tax on the keg and pass that along. If they did try to steal money based on the tax I'd go elsewhere for my libations.

    In fact, I rarely pay $3 today as there are so many great beers in town and pubs that have happy hour prices under $3 these days. Good for all of us.

    Also, the bigger complaint I have is the entire http://honestpintproject.org/ concept. I now make a point of only attending places that actually serve you a true pint of beer. It seems like the retail establishments have been serving us smaller amount of beer while increasing the cost. Think how many glasses of beer that you paid for a pint and get 12oz then add up your lost beer. That is much greater.

    Josh