GULFPORT, MS (WLOX) - Craft beer producers around America are poised and ready to take advantage of tax cuts passed by Congress. Because of the new tax laws that went into effect at the beginning of this year, breweries will see significant savings. For the 12 microbreweries in Mississippi, the new law opens the door on reinvestment.
Chandeleur Brewing Company in downtown Gulfport is excited about a business opportunity provided by tax reform legislation passed by Congress. The new law cuts the federal excise tax for breweries, wineries and distilled spirits producers in half. As a result of saving money on the cost of doing business, breweries see an opportunity to expand their operations.
"There are so many benefits," said Dave Reece, Chandeleur's brew master. " It frees up a lot of cash for us that was going to the government. We're going to be able to reinvest in the company. We're going to create some jobs, hopefully. Ultimately, it's going to mean better beer for everybody; more beer and more jobs.
The National Brewers Association calls the Craft Beverage Modernization and Tax Reform Act a tremendous step forward for America's small brewers and historic legislation. According to the Mississippi Brewers Guild, 12 craft beer breweries now operate in the state with five producing products on the Gulf Coast.
Brewers believe this law shows that the craft beer industry is gaining ground in terms of national recognition as an important player on the American business scene.
"There's more than 5,000 breweries in the country now," said Reece. "We're a legitimate business. This is a real good way to help the little guy."
The excise tax is cut from $7 a barrel to $3.50 on the first 60,000 barrels for domestic brewers producing less than two million barrels annually. The estimated national tax savings is $142 million a year.
At Chandeleur, the thinking is they will be ready, willing and able to parlay tax cuts into significant reinvestment.
"Anytime you leave more money in the pocket of the small business owner, they're going to put it back into their business," said Reece. "You are going to see a quick return on this."