Taxes Account For 45 Percent Of A Beer's Cost: Beer Institute

The Most Expensive Ingredient In Beer: Taxes

Beer’s ingredients of yeast, hops and water make up its deliciously golden hue. But the one cost that makes beer hardest to swallow might just be the taxes on it.

When combining state, federal, excise and wholesale taxes, among others, around 45 percent of the cost of a beer is tax related, according to trade association The Beer Institute. State and Federal business taxes are among the most expensive, accounting for 36 cents of every dollar spent on beer.

When all those glasses, solo cups, cans and bottles of beer add up, the beer industry accounts for around $44 billion in tax revenue, with $10.8 billion of that being attributed just to the consumer, CNBC reports.

Maybe unpredictably, the vast majority of Americans aren’t in favor of raising taxes on beer, according to a separate Beer Institute survey. But even with the high taxes, American beer drinkers probably shouldn't be complaining. On average, the United States is one of the countries where citizens have to work the least amount of time to afford a beer, according to a recent analysis by The Economist.

Of course taxes on beer aren't as bad as taxes on some other vices. Not including often hefty excise taxes, cigarette smokers pay $1.01 in federal taxes per pack since an April 2009 hike, USA Today reports. The increase has accounted for a $30 billion increase in tax revenue.

(Hat tip: CNBC)

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