Opinion: Don't let massive tax increase kill Oregon's wineries, breweries
Closures due to COVID-19, coupled with the unprecedented wildfires last fall, have had a devastating impact on Oregon's breweries, wineries, distilleries, restaurants, bars and hospitality sector.
The last thing our local businesses can afford right now are the tax increases proposed in House Bill 3296, which would increase taxes on beer and cider by nearly 3,000% and increase taxes on wine by 1,700%. If passed, that would make Oregon the state with the highest beer, wine, cider and spirits tax in the nation.
A to Z Wineworks and Rogue Ales & Spirits are two of Oregon's most iconic brands. Our products are enjoyed by legal drinking age consumers, not just across America, but around the world, bringing tourism, commerce and prestige to Oregon.
Craft beer and wine helped put Oregon on the map. Prior to the COVID-19 pandemic, Oregon was home to 400 breweries and 900 wineries creating more than $12.5 billion in economic activity, 80,000 good-paying jobs that equate to $3 billion in wages annually.
Sadly, reports from the Oregon Wine Board and the Beer Institute, show the Oregon beer and wine lost about 20,000 direct and indirect jobs in 2020 because of the pandemic. The hospitality sector was hardest hit in Oregon, with 50,000 jobs lost according to the Oregon Office of Economic Analysis.
Tax increases make it harder for our businesses to invest in rehiring, equipment upgrades and expansion. But HB 3296 will absolutely put Oregon craft breweries and wineries out of business, drying up revenue for the state. Because we are such a large part of Oregon's economy and culture, adult beverages already are the third largest source of revenue for the state.
Raising taxes on beer and cider from $2.60 a barrel to $72.60 per barrel and wine from 65 cents to $10.65 per gallon aren't minor adjustments a business can simply absorb or pass along to the consumer, especially for those who sell their craft beverages only in our state.
All Oregon brewers and winemakers are extremely passionate about what they do, and we also need to have profitable businesses in order to pay our employees and contribute to Oregon's economy. For A to Z Wineworks and Rogue Ales & Spirits, this tax hike would affect all parts of our businesses, from where and how we invest in infrastructure to hiring new employees.
As local business owners and residents, we care deeply about Oregon. That's why we invest and create so many jobs here in our communities. Without question, more needs to be done to prevent and address addiction and we stand ready and willing to work with lawmakers and stakeholders. The resources already are there, we just need to use them better. Only 3.5% of existing beer, wine, cider and spirits revenue are dedicated to addiction recovery.
Before raising taxes on Oregon's homegrown businesses, politicians need to deeply examine the current system and why existing dollars are not being spent on these programs.
Oregon's breweries, wineries, cideries, distilleries, restaurants and bars need the support of our customers and elected officials. Voters know our businesses are job creators for our state and must be protected, which is why 74% of Oregonians oppose increasing our taxes.
We're calling on lawmakers to oppose HB 3296
Sam Tannahill is the founder and wine grower of A to Z Wineworks of Dundee. Dharma Tamm is president and CEO of Rogue Ales & Spirits of Newport.
You count on us to stay informed and we depend on you to fund our efforts. Quality local journalism takes time and money. Please support us to protect the future of community journalism.