I
103D CONGRESS
1ST SESSION
H. R. 1928
To amend the Internal Revenue Code of 1986 to repeal the ‘‘luxury tax’’
on beer, enacted in the Omnibus Budget Reconciliation Act of 1990,
which doubled previous excise levels.
IN THE HOUSE OF REPRESENTATIVES
APRIL 29, 1993
Mr. COX introduced the following bill; which was referred to the Committee
on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to repeal
the ‘‘luxury tax’’ on beer, enacted in the Omnibus
Budget Reconciliation Act of 1990, which doubled pre-
vious excise levels.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. FINDINGS.
The Congress finds the following:
(1) The 1990 Omnibus Budget Reconciliation
Act, which contained several so-called ‘‘luxury
taxes’’, increased the Federal excise tax on beer by
100 percent, to $18 per barrel. As a result, as much
as 20 percent of the retail price of beer is now Fed-
eral tax; and total taxes now account for nearly 75
cents on the retail price of every 6-pack of beer.
(2) Middle and lower-income Americans, who
comprise 
the 
vast 
majority 
of 
our 
Nation’s
80,000,000 beer drinkers, cannot afford this tax on
one of their few ‘‘luxuries’’. As a result of this re-
gressive tax increase, beer is now taxed at 3 times
the rate of most other consumer products. Those
who would presume to indulge in the ‘‘luxury’’ of
purchasing beer are now among the most heavily
taxed people in our society.
(3) The 100 percent increase in the Federal
beer tax—this new, so-called ‘‘luxury tax’’—has de-
stroyed 31,000 jobs. It has, however, succeeded in
preventing people from enjoying this ‘‘luxury’’: total
beer sales have suffered the worst decline in 30
years.
(4) As a result of the ‘‘luxury tax’’ on beer,
$463,000,000 in wages has been lost in the brewing,
wholesaling, and retailing industries. In addition, di-
rect purchases of products needed to make beer, in-
cluding 
agricultural 
products, 
has 
fallen 
by
$207,000,000.
(5) The 100 percent increase in the Federal
beer tax has not, unfortunately, resulted in a dou-
bling of Federal revenues. To the contrary: the de-
cline in demand, the resultant loss of jobs, and the
reduction of direct purchases has cost Federal and
State governments hundreds of millions of dollars in
lost tax revenues. The ‘‘luxury tax’’ on beer has cost
millions more in increased outlays for unemployment
compensation and other social services to help those
who were put out of work by this ill-conceived tax
increase.
(6) Because of the regressive nature of the
‘‘luxury tax’’ on beer, its negative impact on the
economy, and its unreliability as a source of Federal
income, this ‘‘luxury tax’’ of 1990 should be re-
pealed.
SEC. 2. REPEAL OF ‘‘LUXURY TAX’’ ON BEER.
(a) IN GENERAL.—Paragraph (1) of section 5051(a)
of the Internal Revenue Code of 1986 (relating to imposi-
tion and rate of tax on beer) is amended by striking ‘‘$18’’
and inserting ‘‘$9’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall take effect on the date of the enact-
ment of this Act.
(c) FLOOR STOCKS REFUNDS.—
(1) IN GENERAL.—In the case of any beer—
(A) on which tax was determined before
the date of the enactment of this Act, and
(B) which is held on such date for sale by
any dealer,
there shall be credited or refunded (without interest)
to the brewer or importer an amount equal to the
decreased tax (if any) with respect to such beer.
(2) DECREASED TAX.—For purposes of para-
graph (1), the term ‘‘decreased tax’’ means, with re-
spect to any beer, the excess of—
(A) the tax imposed by section 5051 of
such Code with respect to such beer (to the ex-
tent a credit or refund of such tax is not allow-
able without regard to this subsection), over
(B) the amount of tax which would be im-
posed by section 5051 of such Code with re-
spect to such beer were such tax determined on
the date of the enactment of this Act.
(3) TIME FOR FILING CLAIM.—Credit or refund
shall be allowed or made under this subsection only
if claim therefor is filed with the Secretary of the
Treasury or his delegate on or before the date which
is 6 months after the date of the enactment of this
Act.
(4) HELD BY DEALER.—For purposes of this
subsection, beer shall be treated as held by a dealer
if title thereto has passed to such dealer (whether or
not delivery to him has been made), and if for pur-
poses of consumption, title to such beer or posses-
sion thereof has not at any time been transferred to
any person other than a dealer.
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