Gov. Bill Haslam signs beer tax reform bill

Authored By James Harrison

Gov. Bill Haslam made beer tax reform official in Tennessee Tuesday, signing a bill into law that freezes the way taxes are levied on wholesale beer sales. 

The bill, which overwhelmingly cleared both House and Senate chambers earlier this month, changes the structure around the state’s 17 percent tax on beer. The tax will now be based on volume rather than price. 

Backers of the bill argued that the old setup, which allowed for some of the highest taxes on beer in the nation, hurt smaller brewers who often sell higher-priced beers. Purchasers would pay more taxes on the same volume of higher-priced craft beer than they would for lower-priced options, often from larger brewing companies.

The new structure makes the 17 percent tax flat for all beer sales, based on volume. Customers will then pay 9.75 percent in sales tax on top of the previous charge. 

Most states abide by a similar structure.