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Proposed increase would raise beer tax by 244 percent per barrel

September 19, 2016
<p>Ferris State University student Alex Kallenbach pours beer into a cup April 12, 2014, at Nachofest at a house on Stoddard Ave. Nachofest is an annual party where tortilla chips and nacho cheese are provided. Erin Hampton/The State News</p>

Ferris State University student Alex Kallenbach pours beer into a cup April 12, 2014, at Nachofest at a house on Stoddard Ave. Nachofest is an annual party where tortilla chips and nacho cheese are provided. Erin Hampton/The State News

Photo by Erin Hampton | The State News

A newly-introduced bill would increase Michigan’s beer tax by more than 200 percent per barrel.

A tax increase of 5 cents per 12-ounce can of beer was proposed by Rep. Thomas Hooker (R-Byron Center).

“I definitely believe it would (have a big impact on college campuses),” Hooker said. “A lot of young people get involved in either high school or college in binge drinking.”

Some MSU students disagree and don’t believe the tax will have an effect on drinking.

“I don’t think that a 5 cent increase will deter anyone (from drinking),” clinical laboratory science senior Tessa Lanzen said.

The proposed tax would create an increase of 244 percent per barrel, which is almost triple the current tax, Scott Graham, executive director of Michigan Brewers Guild, said.

“If the tax is going from $6.30 per barrel to $21.70 per barrel, we’re probably looking to generate about $103 million per year,” Hooker said.

This would create a large tax revenue spike.

Current beer taxes generate about $39 million, Hooker said.

The tax money would go toward alcohol prevention programs, including agencies throughout the state and the Michigan State Police, to help combat drunk driving and alcohol abuse, Hooker said.

The proposal has drawn its share of criticism.

A tax increase would hurt the growing brewery industry in Michigan, Graham said.

“It would slow down growth and be a hardship on businesses,” Graham said. “We’ve got something that’s been great for Michigan’s economy and now (Hooker) wants to heavily tax it.”

Brett Visner, director of public affairs at Michigan Beer and Wine Wholesalers Association, said he believes the tax would hurt everyone who consumes and produces beer.

“Tripling the beer tax would hurt the breweries, beer pubs, retailers and the individuals,” Visner said. “Along state lines it will drive people across the line, again hurting revenues.”

The bill has been referred to the House Committee on Regulatory Reform, where it must pass before it can move any closer to being put into effect.

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