News Shelton Brothers issue statement regarding New York's repeal of beer tax and fee exemptions

Discussion in 'Beer News & Releases' started by Todd, May 1, 2012.

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  1. teal

    teal Initiate (70) May 3, 2012 Wisconsin

    The one thing I don't know if I really buy is the idea that shortening up the "space" in price between a NY brew and an import will drive consumers to forgo the local brew for the Shelton/import.

    1. Not living in NY, I don't know but no one's proven or mentioned that such a "space" existed to begin with
    2. Quality/Craft beer drinkers I know aren't usually bargain shoppers. We all subscribe to "drink less, taste more" so I don't know of anyone who'd say "Damn PBR is now only a dollar less than Brooklyn Brown Ale - good enough for me, PBR me ASAP". Dunno, maybe drinkers are different in NY.

    Also - as a non-resident of NY - Were NY based beers cheaper, at the tap/on the bar than beers not brewed in NY (and thus subject to the taxes and fees)?

    I have a feeling - in the end, it's going to come down to the bar as to how this hits the consumer. Some bars will raise all prices and blame the government, some won't. That's probably where the consumer is going to have to vote the most with their wallet and let those bars hitting their patrons for an extra 1.50 which the taxes are only responsible for maybe 25 cents of - tell them why you're not there, with the math if necessary.
  2. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    I am not sure why you continue to support a move like this. Perhaps you think shelton will see your fanboy attitude and toss you some loons or something? If you are a fan of beer, you should be against any legislation that makes it more expensive PERIOD (unless you are one of those oddballs who wants prices to increase so that there is less competitioin in acquiring brews).

    Legislation that is designed to favor local business is smart. There are plenty of unfair rules on the books, but repealing one to hurt small business and large business because it is local has NO winners. Shelton isn't even a brewery, they are a middle man...I hope you are this passionate about actual unfair laws...or maybe just trolling looking to get a rise out of people since this has no effect on your life.

    I realize you don't think it is a big deal for people to have to pay a little more, but to a lot of people that is a big deal and the costs are pushed on to us consumers. I am glad you figured out what the increase SHOULD be, but you don't live here so you are out of your element (DONNY). NYers are gouged enough. I really hope something similar happens in your town since you are so in favor of it. I harken back to gas prices which is another commodity that varies in price due to state taxes. I hope they bump yours up to meet ours so you can bitch and moan and see the effect that a few pennies has on local business. When you get off your overly righteous Nya Nya soapbox spewing about costs that others have to pay, take a step back and realize what you are fighting for. Pointing the finger at the system is easy, the system is broken in way more ways than this (and to be honest legislation favoring local economies is not unfair, it is smart) but Shelton bros are the kids in the classroom who tell the teacher and then ruin it for everyone. You probably wouldn't care if taxes got lifted on outsourcing jobs and you lost your job as a result so that the field could be leveled would you?

    Or perhaps you just work for shelton?
    bhir and beertunes like this.
  3. teal

    teal Initiate (70) May 3, 2012 Wisconsin

    In the end the ONLY people who can change it are NY's. Are they gouged? Yeah but whining about it to a guy who may live in Nebraska isn't helping anyone. Not to get political but all politics are local.

    Don't like getting gouged? Do something about it, in NY. That's the ONLY recourse you have.
    Beerandraiderfan likes this.
  4. emannths

    emannths Initiate (192) Sep 21, 2007 Massachusetts

    Like I said, I am in favor of lower prices and laws that give small brewers a break, particularly on regressive fees like the label fee. I just don't think the way to do it is to say that the state, courts, or private actors should look the other way when a law is clearly unconstitutional.

    NY could have extended--rather than eliminated--the exception to out-of-state brewers, and they chose not to. They could have enacted legislation--which I would probably support--that could legally help out small NY brewers. There are plenty of solutions to this problem that don't involve bitching that Shelton Bros is a snitch and a killjoy. Problem is, no one bothered (ahem, NY legislature or NY brewers) to go down those more productive paths, so we're left with people talking out of their asses about how an extra dime per beer is going to cause NY breweries to fold by the dozen. I'm not trolling--I'm just trying to be a voice of reason among the Chicken Littles that populate BA from time to time.

    We had similar issues here in MA--there was a proposal to apply the sales tax to beer. Everyone in the industry bitched and moaned that this would kill MA small businesses like breweries and retailers because it would "cost" them so many millions of dollars. Well, it passed, and all we have to show for it is a rash of new breweries. I didn't like paying 7% more, but it honestly was no big deal.
  5. bum732

    bum732 Meyvn (1,150) Feb 18, 2008 Lesotho

    Do you whine this much every time they increase the price of your favorite candy bar? The impact of this is fairly negligible, yet you feel the need to make this huge emotional argument out of it. You say its an unfair rule, but then say you support it. Try using a more logical approach, people might take you more seriously.
    Beerandraiderfan and beerindex like this.
  6. Dcv

    Dcv Initiate (0) Nov 12, 2009 Michigan

    I may have missed it when I was reading these posts, but did the NY breweries pass these savings on to consumers before the law changed or did they just get to enjoy a higher profit margin on their beer?
    Beerandraiderfan and StarRanger like this.
  7. stupac2

    stupac2 Zealot (518) Feb 22, 2011 California
    Beer Trader

    Do you need to ask?
  8. beerindex

    beerindex Initiate (123) Jun 18, 2007 Michigan
    Beer Trader

    And what of it? I'd sooner defend them because I see them actively involved in litigation designed to challenge fundamentally unfair laws, be it over those Ridgeway beers, NY's previously unequal taxation laws, or Missouri's franchise laws (in the case with Mobev). Better that than defending Brooklyn Brewing, which from Oliver's response here and what Shelton has said, handled the situation incredibly poorly.
  9. cavedave

    cavedave Poo-Bah (2,211) Mar 12, 2009 New York
    Beer Trader

    Finally one of the out of state people realizes that we aren't stupid here, we know that the law was unconstitutional, it is a case of a straw and camel's back.

    We pay more in taxes here already than any out of state person responding with their out of state opinions. This means we already pay more for our beer, and virtually every other thing, if you factor what is raped from our paychecks.

    I have a trading partner asked in disbelief how I could pay 12.99 for sixers of ST 2XIPA, when he pays 3.00 less and is hundred of miles farther from the brewery. So yes, the Ma. based Shelton Bros. gains no love for what they did, and arguing legal points which you are correct about with us, and advising that we should just bend over and grit our teeth shouldn't be expected to be a popular opinion with us. Thanks at least for recognizing it.
    grandq, keef, beertunes and 2 others like this.
  10. chcfan

    chcfan Devotee (466) Oct 29, 2008 California

    I know Microsoft has been saving millions per year in "hidden" tax breaks. I actually thought this kind of thing was common in that states were willing to forgo some tax dollars in order to reap the benefits of having a business be headquartered there - mostly jobs, which means income taxes. I thought that that was also why some large banks are headquartered in DE, but maybe that's just low taxes for them in general.

    Anyway, if it was unconstitutional, it should have been done away with and my level of care would still be low even if it was in my state. I would only be annoyed that the already high prices that we pay may go a teeny bit higher.

    I still think the press release is a bit douchy, and I don't get the connection with the tax-break being directly related to bonuses, unless I'm missing something. NY brewers know their costs and structure around that accordingly.
  11. bhir

    bhir Initiate (0) Nov 1, 2011 Pennsylvania

    Considering all the steps involved this, the press release should have been the one where SB at least pretended to be interested in looking professional. If they cannot hide their DB'erry in the press release, one can only imagine what kind of a-holes these people really are. F them and their beer.
    beertunes and cavedave like this.
  12. nathanjohnson

    nathanjohnson Initiate (0) Aug 5, 2007 Vermont

    A huge percentage of corporations in the U.S. are chartered in Delaware due to favorable laws about a bunch of things. See:

    I find the outrage at the Shelton Bros ridiculous. I was unaware that pointing out laws that are unconstitutional is morally wrong. I'm not crazy about how the Sheltons operate, but in this case, they are 100% correct. There's a really good reason for striking down in-state vs. out-of-state disparate tax structures, which is to prevent states getting into tariff wars. This issue has been settled for a long time.
    Beerandraiderfan likes this.
  13. chcfan

    chcfan Devotee (466) Oct 29, 2008 California

    No outrage here. I think the unintended consequence was a bit unfortunate for NY brewers, but it's not like this will cause any closures or anything and if it was unconstitutional, it definitely should have been changed.
  14. PangaeaBeerFood

    PangaeaBeerFood Initiate (0) Nov 30, 2008 New York

    I don't think there is any question that the exemption was definitionally unconstitutional. And even if people disagree, it's moot at this point because the Supreme Court has already made that decision. I think the real debate, at this point, is whether or not the current taxation is fair. I'd argue it clearly is not and becomes far more imposing to New York breweries than out of state ones, shifting the balance now to out of state favoritism. I don't think it was the intention of New York State, I just don't think they thought the issue through. To steal a line from the Obama playbook, they used a hatchet to solve the problem, when they really needed a scalpel.

    Absolutely. Most breweries, in fact, every brewery I've ever spoken to about it, works on a flat margin. They take their production costs, add in the overhead, mark it up X percent and call it a day. Those savings definitely passed to the consumer and, in my opinion, was pretty obvious by prices on the shelves.
  15. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    Don't care much for candy, but beer...i do care about (but to your point, yes, i do whine when costs that affect my life go up for no good reason...and sometimes i even take action and contact my local representatives...every year i get my house re-evaluated for potential property tax adjustments, because i work hard for my money). do you not care when costs go up? i care very much about rising prices and costs...i own a home and support a family. as someone who is 31 (from your profile), i would imagine that you have entered the "real world" and aren't just living off of student loans in grad school fantasy land. unless you are a trust fund baby, rising costs probably impact your life too, no? there is no way around it...prices will continue to go up and up and up...i'm just not a fan of them going up due to a situation like this (imagine your neighbor contacts the tax board to inform them that your house is undervalued and as a result your taxes go up...seems like a BS move by your neighbor, no?). you want to talk about unfair yet legal legislation...there are many more suitable places to start then laws around beer. i just don't appreciate the way that this was handled and the net outcome and i'm shocked that so many people defend the actions taken by shelton. shelton didn't get anything positive from this...they just made things harder for brewers and consumers in a market that they want to sell in (and like i mentioned earlier, good luck even finding the beer here for any of the breweries they carry that are worth supporting).

    i've yet to see the actual effect, but like i mentioned the news picked up on this story and said that pints are expected to go up a buck to the consumer, which is not insignificant. even at our crazy prices, you are talking about at least a 10% increase (and that's in the more pricey places most places will be closer to a 20% increase). if this happened in your home market i'm sure you'd sing a different tune. i imagine the breweries will take a stand and if someone organizes an effort around this, i'd be happy to throw my support their way.

    is supporting something "unfair" a problem? i support any tax breaks that apply to my situation...and i most certainly support tax breaks given to local businesses that aren't given to out of state businesses. don't think it is fair, i think it is smart. capitalism, by nature isn't fair...that would be communism. do you only support fair rules? do you support taxes put on companies who outsource jobs or you think the field should be level and "fair" so that your company can farm your job out overseas and save a few bucks? logic is not my problem, it is more the audience that reads my posts...but then again, if i wanted to be taken seriously (which i don't, i just like to voice my opinion like every other poster on this site) i wouldn't be posting on, i mean i'm just shocked that there are actually some out there who think that this move by shelton (who catalyzed the change) isn't shady...that's all.

    my logical one liner in a nutshell is "beer being more expensive = bad"
    beertunes likes this.
  16. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    locally produced growlers and pints have always been cheaper from what i have seen.
  17. stupac2

    stupac2 Zealot (518) Feb 22, 2011 California
    Beer Trader

    What do you think this tax will add to a sixer? I'm pretty sure it's like $0.10. I just can't imagine getting worked up over something that makes beer more expensive in a way that's pretty much impossible to notice.

    Also, you weren't pay ANY taxes before (well, excise taxes). Beer was more expensive because of other cost of living things, which may include property taxes and such. But complaining about the cost of beer in San Francisco is silly, EVERYTHING is more expensive in San Francisco. I'm imagining it's the same thing for you.
  18. cavedave

    cavedave Poo-Bah (2,211) Mar 12, 2009 New York
    Beer Trader

    I am sure San Franciscans pay plenty, and I am sure they are out in the streets celebrating every time their cost of living goes up even comparatively higher to every one else's. Perhaps you aren't suggesting we New Yorkers celebrate this latest cost of living increase for us, but it is you who is silly if you think we shouldn't be upset about it. I don't complain here about all the other ways we get raped because this isn't price of living advocate it is Beer Advocate. Maybe you suggest we just get used to, or celebrate, businessess and taxpayers leaving the state, our property taxes going up, and the rest that makes my tax load and consequences worse than yours. Sorry, I can't. And did you somehow miss the straw and camels back ref. in my post you quoted?
  19. stupac2

    stupac2 Zealot (518) Feb 22, 2011 California
    Beer Trader

    That's not what I'm saying, I'm just saying that if you drink 2 beers a day every day for a year you're going to pay like $13 more in taxes. I just cannot fathom getting upset over that level of tax increase, no matter what the baseline is. It is just objectively not very much money. Like, if $13 a year is a big deal to you then why are you drinking craft beer? If the straw that breaks the camel's back for you is something that small, well, then, my guess is you get upset about tax increases pretty often.

    Anyway, if you are upset by that, have you contacted your state legislator? Because talking about it on here is completely useless, while that actually has a chance of something happening.
  20. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    No, no, no. This was more recognizing what was unspoken (in that people can't really be that upset at being equals, NYers don't really think they're deserving of brewery affirmative action do they? They're not saying they can't compete without a leg up are they?).

    Its not the straw that broke the camel's back, its the pea underneath the matress that is causing the princess to cry!

    By your rationale regarding the amount of taxes one pays and their opinions, uber rich people would be correct to tell all you jobbers making less than $100 million to quit crying, you don't pay shit compared to them.

    Your local breweries took the $ and ran, rather than pass the savings on to the consumer. And now that they're being put on equal footing, they're pretending they can't compete when put on equal terms. And so NYers are going "Equality? Screw you Shelton Bros!! We want preferential treatment!"
  21. bum732

    bum732 Meyvn (1,150) Feb 18, 2008 Lesotho

    Again, i don't see why you're blaming Shelton for something that your state decided to do. Shelton was just looking out for their interests. Maybe their plan backfired, who knows. But you're blaming the wrong people, IMHO.

    [citation needed]

    So you make assumptions based on my profile, and miss that i live in Montgomery County. In case you didn't know, the county i live in is where MADD was founded. You can bet your ass that our beer laws and taxes are ridiculous, probably more so than NY state (i could be wrong, i don't know the exact numbers). As Hill Farmstead pointed out, they are being taxed much higher for their product than NY brewers will be even after this ruling.

    LOL WUT. Nice straw man, btw. Look, i get it, prices are going up by 10 cents, i feel your pain. I just don't see why its such a big deal in the big picture. And i don't see why blaming Shelton makes you feel better about all this.
    StuartCarter likes this.
  22. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Hidden? But you know about it . . .

    Delaware has pro business incorporation laws.

    They don't violate the constitutional notion of equal protection. That's the difference between the situation we're discussing and what you interjected.
  23. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    You realize this alleged $1 increase per pint is 100% because of the actions of New York residents? (i.e. the NY legislators, the breweries and the bars?).

    Shelton didn't decide to charge NY breweries the tax, the NY legislature did. The NY legislature didn't decide to take a $3.50 tax per keg and jack the price up $1 per pint to cover that tax, breweries and bars did. . .(assuming the $1 price increase NYers cite in their news is true.)
    teal and funkel81 like this.
  24. deadbody

    deadbody Aspirant (296) May 10, 2010 Minnesota
    Beer Trader

    Based on your posts here you strike me as someone who is so wrapped up in his own crap that he is unable to see the actual issue.

    The tax increase is going to be a couple cents per pint. Even adding up the distributors margin and the retail margin it should only raise the price a quarter a beer or so. If your local bar raises the price $1 a beer that is them gouging you, not Shelton Brothers.

    Shelton Brothers wanted an illegal tax law fixed. Your comparison to your neighbor is more akin to you having put in a huge new addition to your house that raised the value by a bunch but not paying the tax on it. When your neighbor calls the county on it they are doing what is best for everyone by putting a level playing field out there.
  25. chcfan

    chcfan Devotee (466) Oct 29, 2008 California

    Hence the quotes...
    I never said it was the exact same situation, but it is in a similar vein to Stupac's examples.
  26. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    No, those things are legal, and in existence.

    The NY favoritism and inequality was illegal, and no longer in existence.
  27. chcfan

    chcfan Devotee (466) Oct 29, 2008 California

    No shit. I didn't remember arguing that point with you, but thanks for reminding me.
  28. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    it doesn't make me feel better, and yes it is my state's fault for having a silly law (although unconstitutional is always up for interpretation, that's why we have the courts system) and it is shelton bros fault for pointing it out. i still think that laws that promote the local economy are positive ones...we can agree to disagree on that point (though i really don't understand why anyone wouldn't be in favor of these kinds of regulations that ultimately promote more jobs and money in their local economy).

    i just don't see why having some compassion for people who's costs are going up is a problem and people would defend the way that shelton handled the whole thing (including calling out brooklyn). the end result is a crappy one. no one is a winner in this, so let those of us most effected by it be upset about it and vent our anger towards the catalyst. this is a message board for pete's sake...this is one of the few places that i can commiserate with my fellow NY'ers who will be affected by this. craft beer is growing at an incredible clip and there is lots of money to be made here...people are starting to take notice and eventually other local governments will see the $ to be made and i'm sure prices will go up all over. just sucks when it happens to you...and i'm certain it WILL happen to you.

    also if you really need a citation of the local news report, it was on Good Day NY probably around the 7:30am - 8:00am hour.
  29. rlcoffey

    rlcoffey Initiate (0) Apr 20, 2004 Kentucky

    It depends on the shape of the supply and demand curves. That determines what percent of the tax is passed on to the customer and what percent is eaten by the brewery. And what percent of the exemption is extra profit/savings for the customer.
  30. mattbk

    mattbk Devotee (467) Dec 12, 2011 New York

    and now to interrupt this thread: just a small bit of data.

    at $0.14 / gallon, NYS is #37 out of 50 states. if you live in NYC, the $0.26 you would have to pay as a brewer would put you at #23 on the list. at #50 on the list is wyoming, at $0.02. i could not find any data on other states that allow in state tax breaks on brewing, so i dont know if the previous law had NYS brewers paying less taxes than everyone else in the country.

    no opinion here! just data.
  31. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    No problem, more than happy to get people focused on the topic at hand rather than non sequiturs.
  32. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Thanks, good to know the claims of "we pay more taxes," were just posing from the uninformed.
  33. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    the actual issue that i see it here is that locally produced beer will cost i missing something? please enlighten me.

    as for your wonderful math on the situation, as i mentioned...the local news reported that the net outcome will be about a dollar more a pint for locally produced beer. that is a significant hike.

    shelton bros were the fairness police on this one and i am not angry at them alone, i am also angry that loop holes in place to stimulate the local brewing economy were viewed as unconstitutional and taken away. shelton gained nothing from this except pissing off a lot of people...seems like a great way to do business. as for your level playing field argument, they don't exist in a capitalist society, there are dozens of laws and loopholes in place specifically designed to encourage business in one way or another (take a look at your tax form and look at all the opportunities to get deductions).

    ...but these "discussions" grow tiresome. i get it, you (and others) have no problem with what shelton bros did and how they handled it and you could care less that the cost of beer is going up for people in NY. those of us in NY (and elsewhere) think that the way shelton went about this accomplished nothing other than hurting consumers in the NY market and helped to continue shelton's stellar track record of pleasing the masses. we will not see eye to eye on this until beer prices go up in your home market.
    beertunes likes this.
  34. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Yes, you either believe in the Constitution, or you don't.
  35. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    i don't necessarily agree with this. NY legislation decided to give tax breaks to stimulate local business. shelton decided to fight these as unfair and get those tax breaks overturned. the net increase to the end consumer (aka you, me, US) is a result of increased costs funneling through the system. we'll see how this all plays out, but even if a pint goes up a dime (cause bars charging $x.10 a pint is normal) i don't see a reason to be happy with shelton, the government, anyone.

    at this point i'm done arguing my point. you are unaffected by this, unless you trade with NY'ers or visit the town. who cares who is at fault? it is a crappy situation with no winners and shelton went through the system to make it this way so they are most certainly on the long list of those that will be blamed, but correct, they are not alone...but to say that they are void of guilt is turning a blind eye to what has transpired.
  36. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

    do you really want to turn this into a debate about laws and the constitution and what is "fair"? where should we start? abortion? affirmative action? outsourcing/importing/exporting? gay marriage? the list goes on and on. this isn't about the constitution, this is about the price of beer. if you want to be a patriot fighting for the constitution there are WAY bigger fish to fry than this.
  37. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Who said anything about being happy? I'm talking about who is adding the cost: NY legislature, NY bars.
    Everyone wins when we are all treated equally as far as I'm concerned.

    Shelton imposes no fees on NY related to this tax structure. Period. NY legislature imposes the tax, breweries charge the bars, the bars charge the consumers.
  38. woosterbill

    woosterbill Poo-Bah (2,616) Apr 6, 2009 Kentucky
    Beer Trader

    It's one thing to have policies that support investment in the local economy - e.g., low property taxes for businesses that choose to build in your town - and it's something entirely different to have laws that penalize non-locals. Your low property taxes can act as a magnet by being relatively lower than other municipalities', but they don't do anything to make non-local businesses worse off.

    Essentially, NY wasn't giving local breweries a tax break, they were imposing a discriminatory tax only on certain people doing business in the state and not on others. Would you think it was fair if the other 49 states saw that their breweries were being unfairly taxed in NY and chose to apply an additional tax ONLY to NY breweries exporting beer to their state? This would hurt the business of NY breweries, which would then lower the tax receipts of the state, which would then be likely to retaliate by raising the non-NY beer tax higher still, which would cause the other states to respond, and so forth. Discriminatory taxes between states are unconstitutional in order to prevent precisely this kind of back-and-forth escalation of taxation that could theoretically end up making it impossible for breweries anywhere to do business outside of their own states.

    It's fine to help your local economy by doing nice things for local firms, NOT by doing mean things to non-local firms who are legally conducting business in your area. There's a real difference.
    rlcoffey and Beerandraiderfan like this.
  39. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Lets just talk about beer.

    What's there to debate? You either support discrimination or you don't. You want discrimination because it used to save you $3.50 on every keg of beer you buy in New York.

    Its not about the Constitution? Really, because that's what the NY court system and attorney general determined it was about. . .
  40. cosmicevan

    cosmicevan Poo-Bah (3,237) Dec 13, 2009 New York
    Beer Trader

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