Iowa's current definition of beer sets a limit of …not more than five percent of alcohol by weight. This limitation places an excessive price markup to beers, ales, porters, stouts and other styles of beer with a greater than five percent alcohol by weight content, reduces the freedom of choice of consumers, forces those seeking these types of beers to do so in neighboring states or pay an exceptionally high price. This limit affects over 75% of the beer styles produced.
Because these "beers" do not fall within Iowa's definition of beer, they are classified as "liquor" and therefore subject to a 25% price mark-up (State Excise Tax). This price mark-up not only limits the beer selection that is available to Iowans, it prices these beers (when available) out of reach and deprives the citizens of Iowa from experiencing some of the most renowned styles of beer in the world. This limit also strangles the breweries and brewpubs in Iowa by forcing them to brew a very limited number of beers and ales because over 75% of beer styles are prohibited by this low alcohol limit.
"Beer" means any liquid capable of being used for beverage purposes made by the fermentation of an infusion in potable water of barley, malt, and hops, with or without unmalted grains or decorticated and degerminated grains or made by the fermentation of or by distillation of the fermented products of fruit, fruit extracts, or other agricultural products, containing more than one-half of one percent of alcohol by volume but not more than five percent of alcohol by weight but not including mixed drinks or cocktails mixed on the premises.
Michigan's: Any beverage obtained by alcoholic fermentation of an infusion or decoction of barley, malt, hops, or other cereal in potable water.
Illinois' "Beer" means a beverage obtained by the alcoholic fermentation of an infusion or concoction of barley, or other grain, malt, and hops in water, and includes, among other things, beer, ale, stout, lager beer, porter and the like.
Ohio's: "Beer" includes all beverages brewed or fermented wholly or in part from malt products and containing one-half of one per cent or more of alcohol by volume, but not more than twelve per cent, of alcohol by weight.
Iowa is in the minority. More than 35 states and the District of Columbia do not limit beer by setting an alcohol limit at 5% Alcohol By Weight.
Existing brands will not become stronger in Iowa as a result of this change. Roughly 97% of the beer sold in the U. S. fits into a category called "light lager" which is also 3.2% ABW. Alcohol laws vary from state to state, yet these beers do not because producing them at a higher alcohol content would raise the cost to the consumer and decrease sales.
Gourmet beers are inherently more expensive. The same quantity of alcohol costs two to ten times as much in a gourmet beer as in the most popular light lager beer styles sold in the U. S. This higher cost is a result of using high quality ingredients, state-of-the-art equipment, production quality and the increased fermentation/aging time required for many styles. Iowans should not be penalized with an additional and excessive Liquor Excise Tax (25% price markup) when these are really beers and not liquor.
Iowa brewers are missing out on new revenue streams. Currently, not a single Iowa brewer can brew the world's wide range of beer styles. As the interest in these esoteric gourmet beers rise, Iowa's brewers are seen as behind the times and lacking creativity - not just within the state, but throughout the nation
Iowa experienced exceptional growth in gourmet beer sales in 2003. According to data from the Alcoholic Beverages Division, sales of gourmet (import and craft) beers increased an unprecedented and astounding 58% over 2002 sales.
Iowa's Excise Tax on gourmet beers equates to a tax that ranges from a low of $2.90 to a high of $14.89 per gallon. Beer in Iowa is taxed at 19 cents per gallon. Nearly 60% of the 120 gourmet beers sold this past fiscal year are above $4.50 per gallon in excise taxes. Some of these beers are even taxed higher than Seagrams Vodka and 46 are taxed at a rate higher than Chi-Chi's Margarita w/Tequila. These liquors are taxed at a supposedly higher tax rate.
Click here to see Iowa's law as it is written
What is the difference between ABW and ABV?
If you multiply the alcohol by weight (ABW) by 0.8 you can get the approximate alcohol by volume(ABV). For instance, a beer that is 5% by weight is about 6.25% by volume. Most of the world uses ABV but the Federal Government and many states use ABW as a legal definition. Click here for a list of common beers and their alcohol contents in both measurements.
Georgians for World Class Beer just changed their law from 6% ABV to a more reasonable 14% last year.