29 June 2015 - Best Beer HQ
Sam Adams: no longer a craft beer?
What is craft beer and what isn’t? It seems that the US Government is finally going to settle that debate…
Democratic senator Ron Wyden has submitted a new Craft Beverage Modernisation and Tax Reform Act that could effectively redefine what is and what isn’t a craft beer in the United States of America.
The act will redefine the tax structure for small and medium-sized breweries. In other words, whether you’ll be defined as a craft brewer or not will be based on how much beer you brew, and therefore how much tax you need to pay.
The exact wording of the Craft Beverage Modernisation and Tax Reform Act hasn’t been released yet. However, Washington-based industry lobbying group Beer Institute has spelled out three of the bill’s key effects.
- Craft brewers will be defined as those that produce less than 2 million barrels per year. These will pay the least amount of tax.
- Medium-sized breweries – those producing 6 million barrels or less of beer – will pay slightly less tax the largest breweries and more than the craft breweries.
- Finally, the macro brewers will pay more tax if they produce more than 6 million barrels of beer in a given year.
The bad news for the Boston Beer Company – the largest craft brewery in America by sales volume, and the company behind Samuel Adams beer – is it will not fit under the craft brewery tax bracket. Its current rate of production is 4.1 million barrels per year.
In the past, Sam Adams’ craft beer credentials have been boosted by some leniency by craft beer industry group the Brewers Association.
The Brewers Association’s definition of what constitutes “craft beer” is based on “traditional aspects” of beer production, who owns the brewery, and, of course, barrel production. In 2010, it had to increase its barrel-production limit from 2 million to 6 million, to accommodate the Boston Beer Company’s ongoing success.
It seems Sam Adams may soon be a victim of its own success. According to Market Watch, Boston Beer Co. has been averaging more than 20% growth annually. If it keeps up this growth, it’ll be classed as a macro brewer in less than three years.
What do you think? Is Sam Adams not a craft beer? Feel free to comment below…