The state excise tax rate on beer in Missouri has been cut by two-thirds.
Gov. Mike Kehoe signed into law House Bill 1041 on Thursday, which set the excise tax rate at $0.62 per barrel for all malt-based alcoholic beverages produced at Missouri breweries, a drop of $1.24 per barrel from the previous rate of $1.86. The new rate is the lowest beer excise tax in the nation.
“We are proud to sign this legislation today, rightly branded as the American Beer Act, to help support and strengthen Missouri breweries, farmers, suppliers, and retailers who brew and sell American beer,” Kehoe said in a statement. “Our state has a long history of being home to some of the best brewers in the nation, and by taking this action today to support breweries at a state level, Missouri is setting an example of supporting companies that are investing in American manufacturing, jobs, and communities.”
The new law’s name, the American Beer Act, dovetails with efforts earlier this year from Anheuser-Busch InBev (A-B), Missouri’s largest brewery, to eschew the term “domestic” in favor of “American” in both industry-speak and consumer-facing parlance.
Often, excise tax cuts offer the lowest rates to smaller producers (seen at the federal level in the now-permanent Craft Beverage Modernization and Tax Reform Act), but Missouri’s American Beer Act applies the rate across all levels of production.
Missouri is home to A-B’s American headquarters in St. Louis and 181 craft breweries, according to the Brewers Association (BA).
Last year, brewers in Missouri shipped 3,509,768 barrels of beer, according to data from the Beer Institute (BI). The state’s craft brewers produced 297,447 barrels of beer, according to the BA.
Using the BI’s shipment volume as a proxy for total in-state production, Missouri brewers would have paid $6.5 million in excise taxes at the $1.86 rate. That total would drop to $2.1 million at the $0.62 rate.
Craft breweries’ volume would have contributed $553,251.42 in excise taxes at $1.86 per barrel, or $184,417.14 at $0.62 per barrel.
Any non-craft production in Missouri likely belongs to A-B, as Molson Coors does not operate a facility in the state, and the second-largest producer is Kansas City-based Boulevard Brewing, which falls under the BA’s craft brewer definition (producing fewer than 6 million barrels annually and not more than 25% owned by another non-craft bev-alc producer).
After craft breweries’ volume is subtracted from BI data, $5.974 million in excise taxes would have been paid on the 3.212 million barrels shipped in 2024. At the $0.62 rate, excise taxes on that volume would drop to $1.991 million – effectively a $3.983 million tax cut for A-B.
Missouri already had the second-lowest excise tax rate in the country. At $0.019 cents per gallon ($0.61 per barrel), it narrowly edged out Wyoming ($0.02 per gallon) for the lowest rate, according to the Tax Foundation.
In addition to slashing excise taxes, HB 1041 also allows producers, wholesalers, retailers and “unlicensed persons” to donate beer, wine and spirits to “charitable or religious organizations and educational institutions for auction or raffle.” In anticipation of the 2026 FIFA World Cup hosting matches in the state, the law allows on-premise establishments to stay open for 24 hours a day and expands alcohol sales from 6 a.m. through 5 a.m. the next day.