RI Microbreweries Offer a Lesson in Regulatory Reform

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Sometimes when one follows the news it seems like the lessons are right in front of us, yet never heeded. Such is the case with Diana Pinzon’s  WPRI article about the explosion of microbreweries in Rhode Island:

In 2016, the General Assembly voted to allow breweries and distilleries to sell limited amounts of their products to plant visitors for sampling and off-site consumption. Prior to that change in law, only wineries were allowed to do that.

Since that change was made, the number of microbreweries nearly quadrupled in the two years, according to the R.I. Department of Business Regulation.

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One of the construction companies for which I worked had its shop a few units down from Newport Storm brewery, and when they had their weekly tours (with sampling), there would always be a line.  But expanding the ability to serve customers directly from the brewery wasn’t the only regulatory change, and the state reduced the targeted taxes and fees on brewers, as well:

Earlier this year, two additional beer industry bills were signed into law by Gov. Gina Raimondo.

The first eliminated the so-called “Keg Tax” that required brewers to pay sales tax on kegs they purchase to fill with beer and then sell to distributors. The second piece of legislation reduced the alcoholic beverage manufacturing and wholesale licensing fee from $3,000 to $500.

What if we took the same hands-off approach across our economy?  Existing businesses would expand, and we can only guess how many innovations might emerge that lawmakers can’t even imagine, let alone be aware that Rhode Island’s regulatory regime is blocking.



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