Archived Story

Brewers say alcohol tax hike will be passed to consumers

Published 9:37am Wednesday, April 17, 2013

ST. PAUL — Lawmakers’ plan to boost alcohol taxes in Minnesota could add as much as $2 to the cost of a standard 12-pack of beer, local brewers and liquor lobbyists said Tuesday as they tried to rally opposition to the proposed tax spike.

House Democrats argue that a hike in Minnesota’s alcohol excise tax, which was part of the tax package they unveiled Monday, would be a small, 7-cent-per-drink increase to help the state raise revenue and pay for the social costs of alcoholism. But executives at two of Minnesota’s largest homegrown breweries said the proposal would quadruple their annual tax bills and eventually hit beer drinkers’ wallets.

“Ultimately, we throw our customers under the bus and expect them to pay for this,” said Mark Stutrud, founder and CEO of St. Paul’s Summit Brewing. “I’m terribly uncomfortable.”

Minnesota charges brewers and wholesalers that sell their products in the state a different excise tax rate based on the type of alcohol. Currently, brewers including Summit pay the state $4.60 for every 31-gallon barrel they brew. Liquors and other spirits are currently charged $1.33 for each liter bottle. For bottles of wine, it varies based on alcoholic content.

Those rates haven’t changed since 1987. The House tax bill looks to bump up all of those taxes, by as much as $27.75 for each barrel of beer.