Diane Bothfeld, Certified Cicerone®
It’s April and tax time is here again. What better reason to have a beer! But beer and taxes have been linked throughout history.
Laws governing beer and taxation go all the way back to ancient Babylonia in 686 BC, to Bavaria in the 1500’s to the United States, and Prohibition in the 1930’s.
Ancient Babylonia was ruled by Hammurabi who put together a code of laws in 686 BC and beer and taxes were heavily indicated in the code for this ancient civilization. Hammurabi’s Code classified beer into over 20 different categories and implemented price controls on both brewers and innkeepers and of course some money for the ruler as well. Beer taxation was born!
One of the next big beer taxation laws came from Bavaria in the early 1500’s – the Reinheitsgebot. The Reinheitsgebot is called the German Beer purity law and Bavarian Duke, Wilhelm IV, declared that beer would only be made with barley, hops and water (yeast was not discovered yet) and that taxes would be collected on the brewers of beer based on the type of beer brewed. The original law was more about taxation than beer purity, but this law impacted the quality of Bavarian and German beers for centuries and is still in place today – when yeast was discovered it was added to the list – the German Beer Purity law – hops, barley malt, water and yeast, are the only ingredients for beer brewed in Germany.
The final notable beer taxation law was at the end of Prohibition in the United States in 1933. Prohibition was ratified with the 18th Amendment to the Constitution in 1920 which outlawed the manufacture, sale and transportation of any drink with more than 0.5% alcohol. When Prohibition was repealed through the 21st Amendment, a three-tier system was put in place to regulate the maker, the distributor/wholesaler and the retail sale of alcohol. This new system was implemented at the state level keeping the three levels separate and distinct, the brewer could not be a distributor, a distributor could not own a retail establishment etc. This was meant to break up the organized crime that had arisen during Prohibition around alcohol. This has shifted somewhat with the advent of craft brewing where small brewers can sell their beer on site, but the volume must be kept low.
With this new three-tiered system came taxes. The Federal government collects an excise tax from all makers of alcohol, then the individual states can collect taxes at all three levels – the maker, the distributor and the retailer of alcohol. County government can also get involved and add further taxes. Quite lucrative – according to the Tax Policy Center, the US collected $7.67 billion in 2019, with the state of Florida collecting $309 million just from the manufacture of alcohol.
So, let’s raise a glass to tax time. There are no comparable beers to what was brewed in Hammurabi’s time but there are fine examples from Germany and the US. For a fine German beer brewed to the Reinheitsgebot standards, try Bitburger Pils – a German lager with a touch of bitterness or Lowenbrau Original a maltier beer with lower bitterness, both great examples lagers brewed to the German beer purity standards.
A beer that existed prior to Prohibition that is still available today is a Cream Ale. Anyone from the Northeast May recall Genesee Cream Ale. This is an easy drinking American Ale with a slightly corny flavor and low bitterness. A great style that survived Prohibition that goes well with these hot early spring days! Drown your tax sorrows or celebrate that tax refund but always drink responsibly
