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Soapbox Article 1: Prices

soapbox

If you have been following our Twitter feed, you would have come across a picture of us buying some Baird Beer at the Bashamichi Taproom and being shocked that nine bottles cost around ¥3,500. Yet some people decided to email and complain that was still too expensive when they could get a six-pack of Kirin for half of that price along with some cod and cheese snacks too.

soapbox prices

Who would have thought picking up some beer would have caused surprise and shock at the prices?

Even when I’ve found cheap craft beer, people are still put off by the price and complain about the intended eye-gouging prices and then go back to drinking imported American, Belgium, British, French or whatever flavour of import beer is the most popular of the month. And then we’re forced to explain why prices are so expensive.

On our travels and interviews of breweries, the general consensus from brewmasters to owners is that the tax is so damned high and it is all-encompassing. Breweries that produce the minimum amount, 6kl for a happoshu license, or upwards of 60kl for a beer license, end up paying the same tax regardless of how new your brewery is. No tax break for you. This amount is roughly ¥220 per litre that is poured out of the tanks for kegging or bottling for a beer. Happoshu-graded beer is slightly less at about ¥180 but the Japanese government is thinking of raising that due to the burgeoning increase of that market.

600ml of beer for 1000yen. 132yen of that is tax for the brewery.

600ml of beer for 1000yen. 132yen of that is tax for the brewery.

But what does that mean for the prices you pay? For every 350ml can or bottle you drink, about ¥80 goes towards that tax. On top of that, there is the alcohol tax levied by the government which can then push up the price higher to anywhere by ¥130 to ¥200. In fact, the tax for beer in Japan can be more than five times the amount of other alcoholic beverages, such as wine or whisky. On top of all these taxes, the customer then has to pay consumption tax, or sales tax aka VAT, which is at 8% at the time of writing though it will increase to 10% in late 2015 or 2016. Without even thinking about, tax is almost at 50% of the price of that craft beer in front of you. Of course, the breweries involved need to make a profit so that has to be included somewhere as well and when you are making 200l batches at a time, the price needs to be higher than if it’s a 16,000l batch day-in day-out.

It’s confusing that beer is subjected to higher taxes than other alcoholic beverages. Let’s take Japan’s national drink according to the world, sake. It’s historically tied up to Japanese culture, with it being produced in temples and drunk for special events: funerals, weddings, New Year’s, and your child’s graduation from kindergarten. Yet the rate of tax charged on it is much lower. Much much lower at ¥120 per litre produced. To break it down even further, beer is roughly around 5%, give or take a few barley wines and imperial stouts, which works out to be about ¥15 per one percent of alcohol, compared to about ¥3 per one percent for sake. Something is not adding up here right?

It’s annoying beer is taxed on a fixed amount rather than levy a tax based on production that would allow smaller breweries to build up their business and become bigger. It’s frustrating how these taxes add up and put people off from buying craft beer and stick to regular beers. If the government were to do a sliding scale for taxes on the production of beers, the craft beer market would be able to grow and improve.

Next time someone asks you why craft beer is so expensive, you can informatively tell them why it is and then join in their complaining by blaming the stringent, all-encompassing tax laws and not the breweries.

(Edit: These are not necessarily the views of BeerTengoku, rather the author themselves. This article may be edited for factual purposes later on.)

About the Author

BeerTengoku Writer

Comments 3

  1. Um, I think the Baird big Wilie glasses are marked at 500ml, not 600ml. That bit on top doesn’t really count as beer.
    Plus buying from a taproom is taking onloop out of the chain, thus you can and should get the beer slightly cheaper. If not, then the ‘we can’t sell it any cheaper’ is a load of BS as they obviously do and another store manages to charge the same price yet still somehow force out a living. Not going after Baird. They give a decent price in the taprooms. I sometimes wish they still used the 360ml bottles, instead of the newer smaller 330ml standard that most others use.
    Baeren usually sells for a decent price, too, as do one or two others.
    However, some other breweries, going by the same tax laws decide to charge a fair bit more for their bottles. Inowashiro, nasu kogen (my god the 9 tailed fox) and a whole lot more have little excuse but desire to get more money. Some of these companies don’t even NEED the money as a few breweries (more than a few) are backed by a larger, richer parent company and at times aren’t even under pressure to make money.
    Until tax revisions come into play, plus business rules get adjusted, so that craft breweries can compete more fairly in the market place, I don’t see craft getting that large a hold on beer sales as, reasons aside, the price of craft is just TOO DAMN HIGH and it doesn’t seem like it’s going down any time soon (the tax should decrease soon) but I’m not sure we will see meaningful change in the bars. Bottles from breweries possibly but the craft bars? Especially when VAT is going up. The last time VAT jumped from 5% to 8% I was seeing a jump in prices a fair but higher than that 3% increase in quite a few bars. I know many places don’t make much money but then neither do many of the customers who pay upwards of 1,000yen a pint for the beers.
    I think many in the industry get angry and defense when people like me raise the issue of price and I know the reasons why making it cheaper is difficult and I sympathise but the bottom line is that it IS expensive and that is why most of us don’t drink more of it.
    Hell, you can justify the price any way you want (not ‘you’ you but a collective) – make every pint bought save the life of an African child but if we the public don’t have the money to spend, those beers won’t get drunken. Sorry, kids. I’m trying!

  2. oops, from the paper under the glass, i take it that is in kirin’s sping valley brewpub complex disneyland type place, not a baird taproom?
    However, I didnt realise they sold beer in measures of 600ml.

  3. the schwarz, i believe being the only dark beer made (at least the one time i was sadly desperate enough to queue up (OUTSIDE) for bloody ages to go there and try the bland, uninspiring beers.

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