The Beer Institute
Annual Report 2020
Proudly representing our nation’s brewers, beer importers, and beer industry suppliers since 1862.
We are continuing a tradition
of passion and excellence.
Meet the Team
The Beer Institute staff are dedicated advocates for all of our nation’s brewers, beer importers, and beer industry suppliers.
RESPONDING TO THE
Like many of you, we had to approach 2020 a little differently than as we expected. But just as the beer industry has evolved and prospered, we adapted and had several significant successes.
Keeping Beer Essential
COVID-19 has caused major disruptions on Capitol Hill, with representatives and senators convening virtual hearings and meetings from their homes and restrictions on outside visitors to the Capitol Complex. The agenda on the Hill also shifted over 2020 to prioritize emergency relief to American families, state and local governments, first responders and American businesses, all of whom COVID-19 affected.
From the onset of the pandemic, the Beer Institute advocated keeping brewing and beer importing as essential activities during COVID-related closures. We sought a deferral in federal excise taxes to help provide liquidity for brewers and beer importers during the pandemic. Additionally, we worked with our partners in wine and liquor to ensure small producers were eligible for Paycheck Protection Program (PPP) benefits, and we continue to advocate for a tax credit to help compensate for the losses associated with beer that perished during COVID.
Into 2021 and beyond, the Beer Institute will continue its advocacy to keep brewing and beer importing essential.
Impact On Beer Industry
Every day, millions of Americans continue to enjoy beer responsibly. Because of the COVID-19 pandemic, the beer industry has seen a dramatic decline both in retail sales and jobs that rely on our nation’s most popular alcohol beverage. Servers and bartenders in our favorite bars and restaurants have been significantly impacted, losing their jobs.
In September, the Beer Institute, in partnership with the Brewers Association (BA), the National Beer Wholesalers Association (NBWA) and the American Beverage Licensees (ABL), released a report from a leading economic firm showing more than 568,000 jobs supported by the U.S. beer industry disappeared in 2020 due to the COVID-19 pandemic. These job losses include more than 3,200 brewing jobs, 1,700 distributing jobs and 360,000 retail-related jobs.
The report concluded that the COVID-19 pandemic resulted in a $20 billion decline in retail beer sales.
Permanent excise tax relief for all of our nation’s brewers and beer importers as part of broader COVID-19 relief will enable our nation’s service industry to begin to recover.
To better understand declining beer sales during the COVID-19 pandemic:
Advocating for the Entire Beer Industry in Washington, DC
Providing Permanent Tax Relief for All Brewers and Beer Importers
On December 27, 2020, the United States Congress enacted permanent reductions in federal excise tax rates for America’s brewers and beer importers. This legislation marked the first time since 1934 that Congress voted to make lower excise tax rates for brewers and beer importers without a sunset clause.
The Craft Beverage Modernization and Tax Reform Act (CBMTRA) was one of the most popular and consistently supported tax bills in the U.S. Congress. Since the bill’s introduction in 2018, more than two-thirds of the House and three-quarters of the Senate have cosponsored this legislation, making permanent the federal excise tax rates for beer that Congress established in 2017. Polling from 2020 concluded 63% of Americans—including 64% of Democrats, 66% of Republicans, and 58% of Independents—supported Congress making the current federal excise tax rates that were set to expire at the end of 2020 permanent for all brewers and beer importers.
Permanent excise tax relief has been a hallmark issue for the Beer Institute. Our members have discussed the importance of making the current rates permanent with members of Congress for many years and our work will continue in 2021 to ensure these new permanent rates continue.
To read more about efforts by the beer industry to maintain the federal excise tax rates:
Deferring Excise Taxes During the
When COVID-19 related restrictions and closures began in March, brewers and beer importers quickly felt the impact of declining retail beer sales. To help them get through the COVID-19 pandemic, brewers and beer importers needed greater liquidity to help pay rent, protect their employees’ jobs, and keep their doors open. The Beer Institute responded by advocating federal income tax deferral for all brewers and beer importers during the crisis.
We were successful. Beer Institute staff met with members of the administration and the House and Senate to provide a compelling argument on why these taxes should be temporarily suspended. As a result, between April and July of 2020, brewers were given a window to defer their payments. We continue to advocate for further deferral and hope that the new Biden administration and Congress will assist our industry as it begins to recover from the COVID-19 pandemic.
Providing a Tax Credit for
When America went into quarantine in March, it could not have come at a worse time for the beer industry, which was preparing for some of the largest beer events of the year. The suspension of public events occurred right before St. Patrick’s Day, and it forced the NCAA to cancel the March Madness tournament, the NBA and NHL to both postpone their playoffs, and Major League Baseball to delay the start of its season. We estimate the industry disposed of $800 to $900 million in expired beer beyond its freshness date.
Along with the costs of disposal, brewers and beer importers, as well as our distributor and retail partners, were stuck with additional costs associated with this unmerchantable beer, including taxes they had already paid for this beer. The current tax code does not provide an adequate solution for brewers and beer importers, distributors, and retailers who had beer on hand they could not sell. That is why the Beer Institute and a coalition of food and beverage trade associations are actively working with the House and Senate to provide a new, one-time tax credit to compensate the holder of spoiled beer at the time it became unmerchantable due to COVID-19 related restrictions.
Congress passed a “lame duck” COVID package that was very limited in its relief to business. We believe in 2021, the new administration and the new 117th Congress will consider additional relief packages. We have been working with respected economists to address cost issues and ensure the tax credit is tailored to the needs of those burdened with this one-time shock loss. We have also garnered the support of key members of the House Ways and Means Committee and the Senate Finance Committee to push for this tax credit when a package materializes.
To better understand how the decrease in sales in bars and restaurants has impacted the beer industry:
Moderate Drinking Definition Unchanged in 2020-2025 Dietary Guidelines for Americans
The definition of moderate drinking in America remains two drinks or less a day for men and one drink a day for women, according to the 2020-2025 Dietary Guidelines for Americans (DGA). The most recent set of guidance on food and nutrition also advises Americans that drinking less is better for health than drinking more, that some adults should not drink, including women who are pregnant, and all adults should drink less overall.
The U.S. Departments of Agriculture (USDA) and Health and Human Services (HHS) publish the DGA every five years, and they released the 2020-2025 edition on December 29, 2020. The DGA are the basis for food and nutrition policy in the United States, and the Beer Institute endeavors to ensure that each DGA establishes the importance of moderate consumption of all alcohol, including beer, wine, and liquor.
In addition to the daily guidance for alcohol consumption, the Beer Institute advocates for consumers to discuss their questions and concerns about alcohol with their healthcare providers and understand the differences between the types, sizes and alcohol content of alcohol beverages in the market. The Beer Institute and our members also believe that people should not consume alcohol beverages on an empty stomach and that it is a responsible decision to include water or other non-alcohol beverages during occasions that involve drinking alcohol beverages.
In July of 2020, the Dietary Guidelines Advisory Committee (DGAC) proposed halving the moderate alcohol consumption guideline for men, even though no new science has been published in the last five years to justify this change. Ultimately, upon publication of the DGA, the USDA and HHS released an explanatory statement of why the recommendation was not accepted, stating that “there was not a preponderance of evidence in the material the committee reviewed to support specific changes, as required by law”.
Additionally, USDA and HHS conducted a transparent and comprehensive review of the science throughout the development process. They ensured that all experts in the field of alcohol research – including those who were not current members of the Advisory Committee – had the opportunity to provide input. Many former Committee members as well as recognized scientists and public health experts – representing institutions such as Harvard Medical School, Harvard T.H. Chan School of Public Health, Boston University School of Medicine, Santa Clara University, and the University of Louisville – concurred with the validity of the decision to maintain the definition of moderate alcohol consumption, a definition grounded in decades of credible research.
To read the full guidance on alcohol consumption for the 2020-2025 DGA:
Ensuring Brewers' Aluminum Prices Reflect Market Fundamentals
Brewers continue to pay an inflated tariff price on the aluminum they purchase–including recycled aluminum already in the United States. The tariffs are embedded in the Midwest Premium, a benchmarking charge added to aluminum purchases. In March, news reports detailed how America’s brewers are paying millions of additional dollars for aluminum ostensibly because of Section 232 tariffs even though less than 15% of those tariff costs are actually going to the U.S. Treasury.
To uncover why aluminum costs are skyrocketing, the House Appropriations Committee included several studies within the reports contained in the House-passed appropriations bills to examine aluminum benchmarking. The American public supports congressional action on this issue, with 72% percent of Americans—including 81% of Democrats and 66% of both Republicans and Independents—wanting the federal government to launch an investigation into the U.S. aluminum market.
To learn more about how the brewers are paying a tariff on recycled aluminum that is already in the United States:
Bringing People Together as Only Beer Can
Reinforcing our Partnership with the National Barley Growers
In February 2020, the Beer Institute partnered with the National Barley Growers Association (NBGA) for their annual meeting and Hill climb in Washington, D.C. As part of this event, the Beer Institute hosted its seventh annual Barley, Brews and Boots reception on Capitol Hill.
Barley, Brews and Boots brings together barley growers from around the country, Beer Institute brewer and beer importer members and hundreds of Hill staffers and several members of Congress–all over a cold beer.
The Beer Institute and the NBGA have had a long partnership where each association amplifies the other, and each one works to advocate policy priorities important to the brewing industry.
Over the years, the Beer Institute has worked with NBGA on crop insurance and farm bill implementation issues. Additionally, NBGA has helped the Beer Institute on excise taxes and trade issues.
The Beer Institute will continue this important partnership into the future and work to ensure that Washington, D.C. knows: No Barley, No Beer.
Telling Beer's Story in Congress "Virtually"
This year made Washington, D.C. adapt to a new way of doing business virtually. As opposed to prior years, where the Beer Institute convened in-person Hill Climbs, this year, the Beer Institute hosted its first virtual Capitol Hill “fly-in,” convening its members from across the country for nearly 40 targeted meetings with members of Congress and staff. We discussed key issues facing the brewing industry, including responsible consumption while people are at home during the COVID-19 pandemic, maintaining the current definition of moderate alcohol consumption in the Dietary Guidelines for Americans, making the current federal excise tax rates permanent for all brewers and beer importers, creating a perishable beer tax credit, investigating aluminum benchmarking and keeping brewing an essential manufacturing activity.
Congress passing permanent excise tax relief for brewers and beer importers – just two months after the BI Hill climb – underscores the importance of Beer Institute members engaging directly with members of Congress and congressional staff.
We will continue these important Hill Climbs in the future, either virtually or hopefully in person!
THE MANY HANDS THAT GO
INTO MAKING BEER
You Ought to Know a Beer Industry Employee
The millions of Americans who make up the thriving fabric of America’s beer industry are as innovative as the beer they are a part of brewing and selling. This fall, the Beer Institute took members of Congress, their staff, and the public behind the scenes of our nation’s beer industry, launching the “You Ought to Know a Beer Industry Employee” series. These live online discussions provided an opportunity for people to learn a bit about their day-to-day work, their backgrounds and ask questions about the companies and the beer industry.
A brewmaster discussed how a beer goes from the concept to the supermarket. A salesperson discussed how the COVID-19 pandemic has impacted bars and restaurants, and the audience learned about the many employees needed to craft and distribute a new beverage across the country. They heard from industry leaders how the beer industry has stepped up for communities during the COVID-19 pandemic and beyond, including manufacturing and providing hand sanitizer to hospitals and other first responders as well as providing drinking water during natural disasters. We are looking forward to continuing this series into 2021.
Click to see the videos.
CELEBRATING BEER’S UNIQUE PLACE IN AMERICAN CULTURE
Beer Still Reigns Supreme on Super Bowl
Beer is not just our nation’s most popular alcohol beverage, but it still claims the crown for what Americans turn to when they gather with friends, family and coworkers to celebrate the Super Bowl. Leading up to the 2020 Super Bowl, the Beer Institute released data demonstrating beer’s dominance during this all-American celebration.
According to Nielsen’s data, in 2019, Americans spent $1.2 billion on beer in the two weeks leading to the Super Bowl, compared to $568 million on liquor and $652 million on wine.
To read more about beer’s unique place in Super Bowl celebrations:
National Beer Day Poll
To commemorate National Beer Day, the Beer Institute released its annual survey of the actor or actress, athlete and musician Americans said they would most want to join for a beer.
The findings: Americans would most like to share a beer with actor and former professional wrestler Dwayne “The Rock” Johnson, four-time Super Bowl MVP Tom Brady, and 11-time Grammy award winner Lady Gaga.
To read more about the celebrities Americans most want to share a beer with:
Bringing the Beer Institute to America's Homes and Devices
To effectively tell beer’s story, the Beer Institute has been a part of thousands of news stories throughout the year. We discussed everything from the need to provide tax relief for all brewers and beer importers to celebrating the unique place beer has in our national identity, including being a favorite beverage for Independence Day and the Super Bowl.
Here are statistics demonstrating our message’s reach throughout the year and some of the news articles where the Beer Institute was a primary voice for the beer industry.