The Beer Institute welcomes bill to prevent unfair aluminium tariff charges

The Beer Institute, the oldest national trade association representing the beer industry, released a statement after Rep. Ken Buck (CO-04) introduced H.R.7078The False Claims Enhancement Act, which would hold aluminium producers accountable for charging a tariffed price on non-tariffed metal.

“Brewers, beer importers and every industry that relies on aluminium are sick and tired of paying a tariff price on non-tariff metal,” said Brian Crawford, president and CEO of the Beer Institute. 

“Our industry has felt the squeeze from Section 232 aluminum tariffs for too long. Aluminum is the single largest input cost in brewing, and the lack of transparency in aluminum pricing hurts consumers. Companies who rely on aluminum must have access to a fairly-priced product, and The False Claims Enhancement Act will protect American workers and manufacturers from those seeking to take advantage of the system.”

“We appreciate Rep. Buck’s leadership on this critical legislation that will ultimately protect consumers and manufacturers,” said David Chavern, president and CEO of the Consumer Brands Association. “Trade policy must be transparent and fair to not burden consumers and allow U.S. manufacturers to continue to be strong contributors to the economy, which is why The False Claims Enhancement Act is so important to our industry, the makers of the great household brands Americans use every day.”

“Users of aluminum in Colorado are being deceptively overcharged by producers under the guise of government fees.” said Rep. Ken Buck (CO-04). “The False Claims Enhancement Act would put an end to this dishonest practice and ensure that production companies are penalized for lying about the necessity and use of fees. As inflation continues to climb, the American public cannot afford to pay higher prices for canned goods due to unnecessary and misrepresented fees charged by manufacturers.”

The False Claims Enhancement Act clarifies that it is a violation of the False Claims Act for a party – such as an aluminum producer – to falsely charge a tariff in a private contract where no tariff is owed and the proceeds are not paid to the government. This would be a strong deterrent to anyone who tries to falsely add a government-imposed charge when none is owed, such as aluminum producers who charge end-users hundreds of millions of dollars in tariffs on non-tariffed metal.

Imported primary aluminium and cansheet are critical to the U.S. beer industry as more than 74 percent of all beer produced in the United States is packaged in aluminium cans and bottles. In 2020, brewers bought more than 41 billion aluminium cans and bottles, making aluminium the single most significant input cost in American beer manufacturing.

According to a study conducted by HARBOR Aluminum, the U.S. beverage industry paid nearly $2.2 billion in Section 232 tariffs on 10.295 million metric tons of aluminium since the tariffs’ implementation. Of that amount, only $135 million (6 percent) went to the U.S. Treasury. HARBOR Aluminium estimates U.S. rolling mills, U.S. smelters and Canadian smelters received $2.04 billion (94 percent) of the total by charging end-users – such as U.S. brewers – a tariff-burdened price regardless of whether the metal was meant to be tariffed based on its content or origin. 

Additionally, the Beer Institute recently launched to educate consumers and lawmakers about the Midwest Premium (MWP), an obscure pricing system that allows aluminium producers to charge end-users a tariff on non-tariffed metal. Shining a light on the MWP will bring transparency and competition back to the aluminium market and deliver relief for the brewers and countless other industries hurt by inflated aluminium prices. You can visit the site to learn more about aluminium pricing and the MWP here.

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