Increasing Beer Taxes is a Bad Idea
Beer distributors pay $5.89 per barrel to the Iowa Alcoholic Beverages Division in the form of excise taxes. Would we prefer that number were lower? Absolutely. But as long as Iowa maintains an excise tax on alcohol, beer distributors advocate for a level playing field for all industry segments by requiring alcohol comes to rest at an independent, licensed premises, which is the most accountable system Iowa has for collecting and auditing applicable tax obligations.
Any proposal to increase excise taxes would further disadvantage lower- and middle-income Iowans and border communities who must jockey with states who have adopted a lower excise tax structure.
Unfortunately, excise taxes are regressive and disproportionately affect middle- and lower-income Iowans. Many beer drinkers are working people, the Joe & Jane Six-Packs, who would bear a disproportionate share of excise tax increases.
Iowa native wine sold at retail is the only classification of alcohol that is exempt from excise tax.
Alcohol taxes accounted for $131.1 million in state revenue in fiscal year 2016.