Oregon microbrewers say they fear a boost in the beer tax would hit them harder than it will the big brewers and put them at a disadvantage in a cutthroat market. Oregon has one of the cheapest excise taxes on beer but it hasn"t always resulted in lower-cost beer. Gov. Ted Kulongoski has expressed interest in raising the tax to help east the state budget shortfall, saying beer drinkers can weather the increase. Oregon microbrewers, which sell about 10 percent of the beer in Oregon, are afraid he"s right. They say raising the beer tax could force them to absorb big cuts in their operations or pass on cost increases that will lose them sales.

Experts say the national breweries spread at least some of the cost of state excise taxes -- which vary widely -- through the country as they aim to hit pricing targets that attract the most sales. The legislation proposes to raise the cost from about eight-tenths of a cent per drink to about 7 cents.

The nation"s highest beer excise taxes are in Alabama, which charges the equivalent of nearly a dime a drink.

21 May, 2003