Community, Demography

Beer Taxes North and South

I listened to a comment from north of the line about how cheap beer is south of the 49th parallel.  So I decided to investigate – and a lot of the difference is alcohol prices is the governmental controls.  Taxes do make a difference in what we drink – particularly when we look at alcoholic beverages. 

A 2018 report titled “Beer Taxes – A Canadian – U.S. Comparison” makes the research easy.  “Beer taxes in Canada are higher in both absolute value and when calculated as a percentage of selling price with an average government beer tax percentage of 47% (of retail price) in Canadian provinces versus an average government tax percentage of 17% in U.S. states.”  Working the math is an exercise in keeping your units straight.    In Canadian dollars, a case of beer is $2.09 taxes in Montana, and $17.32 in British Columbia.  

Montana taxes beer at 14 cents/gallon, Wyoming at just 2 cents/gallon, and Tennessee at $1.29/gallon. It’s a little harder to calculate the Federal taxes on beer:  $3.50 per barrel on the first 60,000 barrels for domestic brewers producing fewer than 2 million barrels annually; or $16 per barrel on the first 6 million barrels for all other brewers and all beer importers; and $18 per barrel rate for barrelage over 6 million. Wikipedia assures me that there are 31 gallons in a barrel of beer.  So we’re looking at 72 cents on the gallon of a big producer’s beer going for taxes in Montana, while craft beers from small brewers are a little more than a dime per gallon. 

Essentially, every time you buy a beer north of the line, you buy a beer for the government.  South of the line, every time you buy a six-pack, you buy one for the government.

Next week – taxation of hard liquor differences.