Raise a glass: New state legislation will protect a tax credit for craft beer makers while creating new policies designed to help add jobs.
Lawmakers announced the agreement June 14 on legislation designed to support New York's breweries and wineries, increase demand for locally grown farm products and expand industry-related economic development and tourism.
The deal will protect a tax benefit for small breweries in New York, exempting breweries that produce small batches of beer from paying an annual State Liquor Authority fee. It also creates a farm brewery license that will allow craft brewers to expand their operations by opening restaurants or selling new products.
"We need these breaks - it's good news," says Oscar Vizcarra Sr., owner of Becker Brewing & Malting Co. at Becker Farms in Gasport, and president of the Niagara Wine Trail. "That's a big savings for us. Some brewers were scheduled to lose or pay new taxes of $15,000-$20,000 extra on their bottom line."
David Katleski, president of the New York Brewers Association and owner of Empire Brewing in Syracuse, says the deal supports the growing craft beer industry, which has nearly doubled in size over the past decade to more than 90 breweries, contributing $200 million to the state's economy and supporting 3,000 direct jobs.
"The deal announced by the governor and legislative leaders gives us the help we need to continue to add jobs and keep prices down for our loyal customers," he says.
The deal reverses an excise tax for beer, which was to come on top of federal excise taxes, corporate taxes and income taxes. The association says brewers would have paid $10,000 to $1 million in additional taxes, depending on their size, much of which would have been transferred to customers in higher pricing at the tap or in stores.
Becker Brewery is among eight breweries in the region, including Ellicottville Brewing Co., Southern Tier Brewing Co. in Lakewood, Mac's Village Brewhaus microbrewery in Orchard Park and four in the city of Buffalo: Flying Bison Brewing Co.; Pearl Street Grill & Brewery; Buffalo Brewpub; and Community Beer Works, a nanobrewery that opened this spring.
Gov. Andrew Cuomo said the state's breweries are creating beer that is consumed across the world, in addition to creating jobs, supporting farmers and hops growers and bringing in tourism dollars.
The legislation provides refundable tax credits to any brewery that produces 60 million or less gallons of beer in New York. A previous law gave small brewers in the state an excise tax exemption, but the legal structure of the exemption was challenged, leading to its repeal. The new benefits announced this week are expected to benefit small brewers at least as much as the prior exemption.
Other aspects of the legislation: Breweries that produce 1,500 barrels or less annually are exempted from the State Liquor Authority's $150 annual brand label fee and creates a farm brewery license that would allow craft brewers that use products grown in New York state to operate in a similar fashion to the state's farm wineries, which legislators say will lead to increased demand for locally grown farm products as well as expanded economic development and tourism.
Finally, the legislation allows farm breweries to host on-premise tastings and sell New York State-labeled beer, wine, and liquor at their own retail outlets, while permitting farm wineries to sell New York State labeled beer for off-premises consumption. Farm breweries could also open restaurants and operate conference centers, inns, bed and breakfasts or hotels on or adjacent to the farm brewery, as well as sell beer-making equipment and supplies, food complementing beer tastings, souvenir items and additional products similar to those allowed under the farm winery statute.
That's all good news to Tim Woodcock, one of several partners working to open Woodcock Brothers Brewery in Wilson by this fall.
"Anything that helps the craft brewing industry is great," he says. "It's just getting bigger and bigger and bigger."