Liquor is the enemy.
That’s the clear message given 550 members of the National Beer Wholesalers Association who gathered at the Hyatt Regency Capitol Hill Hotel in Washington Monday (4/4) for NBWA’s first legislative conference after Covid-19 forced cancellation of the 2020 conference.
With beer shipments sinking month after month, “the liquor industry is going on the offensive to seek lower taxes” that would actually be equivalent on a unit-of-alcohol basis with beer and to be able to ship distilled spirits direct to consumers through the U.S. Postal Service, NBWA President/CEO Craig Purser said.
“Liquor is swinging for the fences,” Purser said, using a baseball analogy just three days before Major League Baseball’s Opening Day, April 7. That day also happens to be the day in 1933 when Prohibition ended for beer and wine and the day a wagon of beer was delivered to President Roosevelt in gratitude.
The issue for beer now is the distilled spirits industry’s reinvigoration of its equivalency advocacy — the idea that a drink is a drink is a drink, and it doesn’t make any difference what that drink is. If a drink really is a drink, and if it doesn’t make any difference whether the drink is beer, wine or spirits, then the alcohol in each beverage should be taxed at exactly the same rate, the distillers argue.
But Purser said, the differences between beer and liquor have been recognized for centuries, and not just in the U.S. Worldwide, beer is taxed at a lower rate than spirits.
Justin Kissinger, CEO, Worldwide Brewing Alliance, said the campaign for governments to recognize alcohol equivalence is a global campaign. The Alliance is interacting with global agencies, such as the World Health Organization, to explain what makes beer different and why the differential in tax rates should be maintained.
Retailers really suffered during the Covid pandemic, Purser said, adding the hotel in which the conference is being held closed its doors just a few days after NBWA had to cancel the legislative conference because of Covid in 2020.
John Bodnovich, executive director, American Beverage Licensees, the retail trade group, said “retailers build brands” and added liquor’s drive for direct-to-consumer shipments not only doesn’t take into account public health concerns, but also fundamentally would change the way business has been built.
Jim McGreevey, president/CEO, Beer Institute, said policy makers are “seeing through and rejecting” liquor’s lower FET proposals.
The final policy issue addressed during the conference was CBD beverages. Bodnovich said it was important that policymakers understand the current alcohol regulatory scheme is “finely balanced” and should not be sacrificed however policymakers decide to deal with CBD. He said he was especially concerned about impaired driving increasing because of marijuana. “Beer,” he said, “is different and better than marijuana.
“The world is watching what’s happening in the U.S. regarding cannabis,” Kissinger said.
Purser concluded the discussion saying, “We don’t want alcohol regulation to be a casualty of the debate over cannabis.”