One Brewpublic reader wrote me today with his concerns about the most recent beer tax proposed my Ben Cannon, representative of Oregon’s 46th District. Brewpublican B Tuwalski writes:
Sorry to trouble you guys, I love brewpublic and look forward every day to new posts. I just got an email returned to me from Ben Cannon who is one of the people spearheading HB 2461 and would appreciate an opion from you guys on how truthful it may be. thanks for your time
Thanks first and foremost for taking the time to consider our website and for reading it. That means a lot. Really. Here is my opinion: Ben Cannon is no friend to the craft brewer. He uses the same myopic reasoning to justify an outlandish house bill that would frantically impede the character of Oregon’s mom and pop craft brewer.
Following is a letter sent to Cannon by B Tuwalski
I am not one of the most eloquent writers so I will be brief. Fact the tax on beer production by the barrel in Oregon is currently at $2.60 a barrel, fact which buts it at the spot of 43rd in the country. Fact you mention in your most recent video that the recent unemployment rate is cutting into the state’s income tax production which you show in your pie graph of being 31% of the states budget source. With this email I am not saying not to raise the tax on beer production at all but I would hope a man of your education would realize that by raising the barrel production tax to a staggering $49.61 would not only produce more revenue put would also produce more unemployed Oregonians that have jobs in the beer industry (i.e. brewers, distributor truck drivers, waiter and waitresses, busboys & girls just to name a few). Now I don’t know if you enjoy a pint of ale occasionally or not, but a major tourist attraction to this state in the wonderful beer that the craft industry here produces leave these Oregonians alone. If you feel the need to tax the life out of someone why don’t you turn your attention towards the out of state producers and leave the production tax here alone. If you found a way to tax the out of state producers (not many will shed a tear if the big 3 have to pay more) who bring their product here you would look more like a true Oregonian instead of a politician who may only get to a sophomore term. Also if the out of state beer costs more due to a tax that you seem intent on creating even more people may feel compelled to drink the local less expensive beer (there is also a carbon footprint tied in with that). Need I remind you that the district you serve contains many a local watering hole, such as the world famous Horse Brass. I hope that you leave Oregon beer industry alone in your search for more revenue.
The following is Ben Cannon’s response (in italics). I’ve interjected my response to Cannon’s claims and declarations along the way.
Thank you for your email regarding HB 2461, which would increase Oregon’s tax on beer in order to fund addiction treatment, recovery, and prevention services.
Even though we may disagree, I do want to take the opportunity to explain my position to you directly.
Currently, Oregonians pay the lowest tax on beer in the nation.
This statement is the untrue. Oregon beer taxes, as you mention are 43 of 50 in the country and remain higher than Colorado (Coors), Wisconsin (Miller), and Missouri (In-Bev/A-B).
Beer drinkers pay a fraction of a penny on each glass they purchase. As a beer drinker myself (I have Full Sail’s Pale Ale in my fridge at the moment),
Cannon has been using this tired one-liner about having a Full Sail’s in his fridge at the moment. He hopes some uneducated, weak-palated, half-witted beer drinker will embrace him as a comrade. Cannon keeps mentioning Full Sail, which is a fine brewery, does his palate stretch beyond this one beer? I have red numerous response letters from Cannon to folks in opposition to his tax proposal and for weeks he has been referencing this one brew. Is he familiar with the Oregon Brewers Guild and the nearly 50 craft breweries in the state? Does he not comprehend that Oregonians consume more of their state’s own microbrews than any other in the USA?
15 cents per beer seems like a fair amount to pay, if that money is earmarked for alcohol and drug related addiction and prevention services.
15 cents seems like a small amount to pay, but let’s take into consideration two things here: 1) This amount is only at one level. Oregon, like many other states, has a three-tier distribution law. This means that there has to be a distributor, or middle man, in the mix when beer is to be sold from the producer (the brewer) to the consumer (Joe Sixpack). This means that on three separate levels, to respond to a supposedly small tax, all three levels would bump up the price to assuage their needs to stay at the same profitability as before. 2) On what grounds does Cannon justify taxing craft brewers in order to fund drug related addiction and preventative services? Is craft beer like Hair of the Dog, Ninkasi, Rogue, Vertigo, Seven Brides, Caldera, etc what the majority of folks needing these services consume? Has Cannon conducted such a study. I liken this misguided swindle to the Clark County, Washington bill that attempted to ban all malted beveraged over 8%. Needless to say, that bill failed horrible when the community took into consideration Salmon Creek Brewing and By the Bottle who were selling craft and imported beers and helping to bolster Vancouver’s ailing downtown economy.
Why 15 cents? No, it wasn’t a random number we just threw out there. In fact, it’s the amount we need to fully fund addiction treatment and recovery programs in our state. We are currently $137 million short of fully funding addiction treatment – and further, drastic cuts are on the horizon. In addition, voters just passed Measure 57 in November, which calls for addiction treatment estimated to cost $48 million every two years. These are good programs, that save taxpayers money in the long run by stopping the cycle of addiction and crime. One recent study indicated that for every dollar we spend on treatment, we save $5.60 in other costs (such as incarceration and health care).
If Cannon really believes that something must be done, and he may be justified, to fully fund addiction treatment and recovery programs in Oregon, I suggest he take a better look at targeting a more causal group and employ more creativity and gumption. His justification is like saying, we need to stop violence in the state, so let’s target boxing and football programs. What about going after low-grade malt liquor companies that target low-income individuals in financially struggling neighborhoods? What about working to legalize soft drugs like marijuana and taxing the hell out of them? What about providing incentives for people to become involved in said treatment programs rather than lowballing Oregonians in a unwarranted, sweeping proposal to garner a quickfix windfall for his mission.
What’s more, by funding such programs through this measure, we take a significant burden off of the General Fund – which frees up hundreds of millions of dollars we can then put towards our hard-hit school budgets.
Most of the emails I’ve received are from people concerned about protecting craft breweries here in Oregon and the jobs they create, and I share those concerns.
Cannon says he “shares their concerns” but has no proposal to assist with them; no plan to encourage small business owners in the craft brewing community to soften the blow of his tumultuous taxation. If his bill were to pass, several microbreweries statewide would dwindle in production and many might even go under. Then, who would he tax? What would he tax?
In the past, beer tax proposals have come with an exemption for microbrews. I met with a great group of brewers a few weeks ago. I asked them for their ideas about how to increase the tax on beer in a way that protects them. What if we exempted them from the tax? What if we kicked back a tax credit? What if we changed the beer distribution system, which currently functions in a way that could allow middlemen to profit off the tax? As of our last conversation, the Brewer’s Guild opposes the tax even with an exemption. However, I am still actively seeking ways to protect local craft brewers while making this much-needed addition to our funding sources for addiction treatment and recovery programs.
What group of brewers? A-B? Miller-Coors? If they were craft brewers, what were their responses? He omits this outright. Ben Cannon-izes the issues and doesn’t go into specifics unless he is talking about the money and the treatment centers he needs. He uses blanket statements and half-hearted promises of tax credits and allowing the middle man to profit off the tax. Sorry, BC, but you’re living in the stone age. Do people really believe a man who keeps using the excuse of having a Full Sail pale in his fridge and other blanket statements to justify an outlandish tax proposal is going to take the extra step to ensure the security of our wonderful craft brewers? He wants to his us below the belt in a time when small business owners are already feeling the blow of a rough economy. Who the hell does Ben Cannon think he is?
I have opened to the door to the beer industry to talk about proposed amount. Should it be lower? Should it be 10 cents a glass? 7 cents a glass? Should a wine tax increase be included as well? Most of the emails that I have received from folks like you agree with me that some tax increase from a fraction of a penny is appropriate. But for over 30 years, powerful corporate lobbyists representing the beer distributors, Anheiser-Busch, and big tobacco have fought even the smallest increase in the beer tax.
How about 0%. For him to cite Anheiser-Busch, Big Tobacco and powerful corporate lobbyist as means to compare Oregonian’s vast palates, and to make mention of even a “fraction of a penny” tax is clear evidence this dude is lowballing us. Ask your friend to give you $100 dollars every day for a month, then the subsequent week, ask him for $1. He might just cave in. Don’t be a sucker!
HB 2461 is a starting point for a conversation that Oregonians must have. 85% of all property crimes are committed by a drug addicted person. At least 55% of all children taken from their families by the state had a drug or alcohol addicted person in the home. 477 Oregonians died in drunk driving related accidents in 2006. Untreated substance abuse costs Oregon $5.93 billion each year. I support dedicated funding for programs that will help decrease these numbers, and save taxpayer dollars in the process.
Actually, HB 2461 is an ending point…for Ben Cannon’s career at trying to represent those he clearly opposes. Methamphetamine abuse is a huge problem for Oregon. However, to accredit this to or make this and other drug abuse problems statewide the burden of Oregon Craft Brewers and those who depend on them for livelihood is utterly ridiculous! Show me the meth abusers and heroin addicts that quaff Deschutes, Standing Stone, Beer Valley, Oakshire, and I might not think Ben’s completely nuts.
Your advocacy is important and I appreciate it, even if we disagree on this one.
State Representative – House District 46
900 Court Street NE
Salem, OR 97301
Oh, and just because you sign your name with a lower case “b” doesn’t make you hip or down to our level. Cannon must go!
Angelo grew up in Maine and is proud to call New England his original home. Cascadia is now his home. He fell in love with great beer in Oregon, Washington, and Northern California.
He has been a correspondent for the Portland Tribune's Guest on Tap column, LivePDX.com, and has been featured in publications such as Beer Northwest and PDX Magazine. Angelo also has a great interest in independent music, and has been a booker and organizer for shows around the Portland under the name Pop Tomorrow! Angelo garnered much knowledge regarding beer from his experiences homebrewing, working at Belmont Station, Pyramid Brewing, Upright Brewing, By the Bottle, Beer Revolution, Olde Depot Public House, Falling Sky Brewing, Cascade Brewing, and from many many knowledgeable, passionate, and loving people along the way. It is Angelo's mission to bring "infotainment" and "edumation" to the readers of this website. If you have any questions or comments, or would like to contribute, please contact me at firstname.lastname@example.org