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

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

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  1. emannths

    emannths Initiate (0) Sep 21, 2007 Massachusetts

    Some bars may increment the price in different ways, but the average increment will be something more like $0.10-0.20, not $1. Or if it's $1, blame the bars, not the tax.

    I'm all in favor of cheaper beer prices, and I think the right way to go in this case would have been to change the law so that exemptions for small brewers extended to all brewers regardless of their location. AFAIK, there's no reason that NY could not have done this. So while the Shelton's may have catalyzed this change, I have a hard time really vilifying them for pointing out an unconstitutional tax. Instead, I'm inclined to point the finger at NY SLA.
     
  2. PangaeaBeerFood

    PangaeaBeerFood Initiate (0) Nov 30, 2008 New York

    A few things:

    Firstly, that is a pimpin' hat in your BA picture.

    But more seriously, I don't think anyone intended to suggest that a half million dollar surprise from Uncle Sam (or Lady Liberty?) is a small feat for any business. Brooklyn Brewery is sizable by microbrewery standards, but in the grand scheme of American business is most definitely tiny. I think more accurately, the intent was to point out that Brooklyn does enough business and has high enough demand that these changes won't be terminal in the way that they might be for recently opened firms or those in the process of opening.

    Deciding who NYS screwed the hardest, though, isn't really the point. At the end of the day, I think New Yorkers are pretty loyal consumers, particularly when it comes to local brands, and we're opinionated as hell when it comes to legal issues. I think we could get these laws reworked with enough noise from brewers and consumers, and most importantly, if we can't, the price increase won't stop guys like me from keeping a steady stock of Black Chocolate Stout in my cellar.

    If you keep making it, I'll keep buying it, and things will be okay.
     
  3. emannths

    emannths Initiate (0) Sep 21, 2007 Massachusetts

    Ok--how many barrels did/will you sell in NY City?
     
  4. ssteigerwald

    ssteigerwald Initiate (0) Mar 4, 2010 Colorado
    Trader

    New York State > New York City.
     
  5. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    And New York City excise tax on beer (26¢/gallon) > New York State excise tax on beer (14¢/gallon)

    ...and probably why "emmannths" asked.
     
  6. emannths

    emannths Initiate (0) Sep 21, 2007 Massachusetts

    Yeah, just curious what a back-of-the-envelope calculation looks like for the breakdown of NYC/NYS/ex-NYS sales, which is doable if you know that the total sales will be 180,000bbl and if you get a number for NYC sales.
     
  7. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Irrelevant. The claim was this new tax associated w/ Shelton Bros suit would cost $500,000 for Brooklyn alone. Not the total tax impact.
     
  8. stupac2

    stupac2 Pooh-Bah (2,031) Feb 22, 2011 California
    Pooh-Bah Society

    Well, I think the NYC tax was waived too, so knowing the breakdown between the two is important for estimating the tax that now has to be paid.
     
  9. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    Irrelevant? Brooklyn sells its beer in the city, in the rest of NY state and also out of state. State beer excise tax is paid based on where the beer is sold.

    "The (former) exemption applies to the first 200,000 barrels (6,200,000 gallons) of beer that is both brewed and sold or used in New York State in each calendar year...Exemption also applies to the New York City beer tax"
     
  10. callmemickey

    callmemickey Initiate (0) Aug 12, 2007 Pennsylvania

    I am always amused by the outrage that the long understood legal principle of corporate personhood has evoked in people.
     
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  11. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Why are we talking about the former exemption if it is no longer the case? Maybe I'm missing something. . .

    Wait, no I'm not. People are just wanting to backpeddal from new tax to total tax burden.
     
  12. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    ? The loss of the exemption is what the Brooklyn Brewery is claiming is going to cost them the $500,000.
     
  13. stupac2

    stupac2 Pooh-Bah (2,031) Feb 22, 2011 California
    Pooh-Bah Society

    People are trying to check Brooklyn's assertion that the tax they will now pay because of the removal of the exemption will be around $500,000.
     
  14. Mebuzzard

    Mebuzzard Grand Pooh-Bah (4,216) May 19, 2005 Colorado
    Pooh-Bah Society Trader

    The more I read this Shelton response, the more it irks me. Yes, NY brewers should be taxed (at least to some extent, maybe not on the levels of imports. I understand that lower tax rates help new and small businesses). I agree. But the way Shelton attacks this is ugly. It is a total effort to shift away ANY blame (real or perceived) by making excuses, hypotheticals and personal attacks, not to mention 'lawyer' tricks. If they just stuck to the issue, it would have been a nice response. Instead, the slime just oozes.

    Yet, initially Shelton wanted to do away with ALL taxation--they said that. So, really they would vote 'NO' on these. But they're appealing to emotion. And being quite defensive.
     
  15. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    OK, let's assume Brooklyn's representations are true: So Brooklyn then saved $.5~ million every year that out of state brewers had to pay under that rationale of what it is going to cost?

    Why can't they just raise their price by the 2-3 cents per pint to cover this 'new to them' expense (like their out of state competitors have been, and will continue to have to pay)?

    I mean, Brooklyns loyal customers will understand right? Its not like Brooklyn has been keeping that good ol' boy exemption $$$ they enjoyed every year prior to 2012 right? They passed those savings on to the customer this whole time, right?
     
  16. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Their position is based in logic, the law and a fundamental notion of fairness and equality. New York's attorney general and court system agreed.

    In terms of appealing to emotion. . . I would have to say the people who fail to hold their own government accountable for the back slapping favoritism and the taxation scheme it implemented, might be the ones relying on emotion more than anything else.
     
  17. Mebuzzard

    Mebuzzard Grand Pooh-Bah (4,216) May 19, 2005 Colorado
    Pooh-Bah Society Trader

    I agree with ya.

    Shelton's response was more than an effort to 'put things straight'
    Shelton strays from this sharply and decides to play innocent (remember, they wanted NO tax....but then support it) and find villains to deflect others' anger. They have good points, and a poisonous message.
     
  18. emannths

    emannths Initiate (0) Sep 21, 2007 Massachusetts

    Fwiw, if Brooklyn sells 180,000bbl this year, the "new" taxes of $500,000 account for a price increase of $0.011/pint (aka, one freakin' penny), $0.018/25.4oz, or $0.05/6pk. Something tells me consumers won't know the difference (even marked up 400% at the bar)--it certainly doesn't sound like a "forest fire" getting ready to burn down the brewery.
     
  19. yalnikim75

    yalnikim75 Initiate (0) May 24, 2010 New Zealand (Aotearoa)

    I can't read this without putting in my two cents.

    I really don't understand the argument that Shelton Brothers are just a business, have no love of craft beer, have invested nothing in producing anything, and are just in it to make squillons. We're a tiny brewing business at very bottom of the world... our beer is expensive to make, and really expensive to ship all the way to USA. The Sheltons have spent thousands of dollars coming down here to meet us (three times) and then patiently waited 2 years for us to be in a position to send them some beer. To say these guys are just in it to make a fast buck is ludicrous. Wake the fuck up, please.

    The first comment at the following link sums up the situation better than anything else I've seen written on the matter... http://beerstreetjournal.com/shelton-brothers-issues-statement-on-new-york-ruling/

    Slainte mhath
    Stu McKinlay
    Yeastie Boys, New Zealand

    ps. to Mr Oliver - I'm one of the overseas brewers who will be attending The Festival in June. It would be an ideal time to round us all up, put us in that bag and throw us in the lake... but, as many of us are fans of your beer and brewery, it would be far more productive for you to come up and have a few beers with us. Bring some of the lawmakers too, if you can, and we'll show them how great it is to have a craft beer scene with diverse brands, unique beers and amazing flavour. A scene where people celebrate flavour and having a blast, rather than blindly sinking piss for the buzz. Lets use it as an opportunity to put an end to any bickering and to show how poorly thought out the label fee is. Surely that fee is most poorly thought out and removing it would be the simplest way to quickly help small brewers. From there you can work on the taxes... we'd be happy to add our minds to the discussion if there is any way we can help. I'm sure many other brewers would too.
     
  20. Beerandraiderfan

    Beerandraiderfan Initiate (0) Apr 14, 2009 Nevada

    Agreed. Their position is logical. The manner in which they went about it enflamed passions. I would not have mentioned anyone by name, especially the most popular brewery in the state you're now being vilified in. Good legal points, poor public relations.

    Bottom line though, if there is an entity that deserves scorn, its the legislature. They came up with the system of favoritism, and they pulled the rug out on their constituents.
     
    yalnikim75 likes this.
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