This is the Cato Daily Podcast for Tuesday, January 13th, 2015.

I'm Caleb Brown.

New legislation now pits big brewers against smaller competitors, but that struggle is really nothing new.

The U.S. has a long history of strange alcohol regulation.

Michelle Minton is a fellow at the Competitive Enterprise Institute.

We discussed alcohol regulation new and old

earlier today.

Well, the Beer Act would reduce the federal excise tax.

So for a lot of people don't know that the cost of their beer is made up, not just of the grain and the hops and the

marketing but breweries also have to pay taxes for the state, state excise taxes and

federal excise tax and right now the federal excise tax is about $18 per barrel but if you're a

small brewer which they define as less than 2 million barrels a year you pay

about seven dollars for your first 60,000 barrels and then it's an 18 after that, so 60,000

up till whatever you produce.

Large Brewers, they pay $18 barrel from barrel 1 till, you know, however many millions are going to produce.

It's just to give that some context most of the Brewers in this country.

90% are making less than 50,000 barrels a year.

So small brewers make up the bulk of breweries in this country. barrels a

Broughts a year. but for example, Boston Beer, which most people know makes Sam Adams,

they are a brewery that makes over 2 million barrels.

So they don't qualify under the current the current definitions as a small

brewer even though we call them a craft brewer.

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