Thursday, April 11, 2013
Beer Tax Rate in Governor's Hands
A proposal to freeze the state's beer tax is headed to the governor for his consideration. The measure was approved 87-2 in the House on Wednesday. The Senate approved it 30-1 earlier this week. Tennessee's beer taxes outstrip any other state's because the bulk of the levy is based on price rather than volume. The more a beer costs, the higher the taxes that must be paid to buy it. In Tennessee, brewers pay federal and state taxes per 31-gallon barrel, and then a 17 percent tax is charged to wholesalers based on price. Consumers then pay as much as 9.75% in sales taxes on top of the previous charges. The proposal would convert the 17% tax to a flat tax in line with the current rate.