Drinking Beer: America’s Taxing Pastime

By: Jessie Markell

In America, beer seems to go hand in hand with baseball games, barbecues, 4^th of July celebrations, hanging out with friends, and, in general, as a great way to unwind after a long day’s work. The old adage, “Beer is proof that God loves us and wants us to be happy,” is often attributed to Benjamin Franklin. And we know that Samuel Adams, Thomas Jefferson, and George Washington all brewed their own beer at home. So why does the government hate it so much?

In economics, taxes on things like cigarettes and beer are called “sin taxes,” and they are easily the biggest buzz kill at any party. According to a study by The Beer Institute, around 45% of the cost of beer is tax related once you combine state, federal, excise, and wholesale taxes. State and federal taxes alone will cost $0.36 for every $1 liberty-loving Americans spend on beer.

According to this info-graphic by the Tax Foundation, the state with the highest taxes on beer is Tennessee, with a tax of $1.17 per gallon – that’s a lot of beer money! Interestingly, the state with the least amount of taxes on beer is Wyoming, with only a $0.02 tax on every gallon.

The federal government’s crackdown on beer reached its peak with prohibition back in 1919, with the 18^th Amendment making the brewing or distilling and consumption of alcohol illegal. When this tyrannical law failed to break the American spirit for spirits, and was ultimately repealed with the 21^st Amendment, the government resorted to their go-to move – taxation.

Unfortunately, when the 18^th amendment was repealed, they “mistakenly” forgot to repeal a provision that made home brewing of alcohol illegal, thus forcing you to pay the government’s taxes whenever you wanted to enjoy the hoppy-goodness. As of July 1, 2013, all fifty states have now passed legislation making the home brewing of beer legal and tax-free.

The best way to stick it to the taxman would to brew your beer at home. But if you must take a trip to your local watering hole, be sure to raise your glasses and toast to “the health of the state,” since it’s where almost half that beer money is going anyway.