The Stout Solution
Taxes—or the avoidance of them—also helped create Irish-style stout. In his book, Classic Stout and Porter, Roger Protz notes that Arthur Guinness II developed his famous recipe by using non-taxed unmalted roasted barley in the place of black malt in his porters to reduce their cost. The bitterness of the roasted barley set his brews apart from those of his competitors in England and Scotland. It was instrumental in making Guinness Foreign Extra Porter Stout, a stronger version that became popular in the colonies. Guinness Double Stout came to dominate the London market. Here again taxes were a factor. As Protz notes:
Guinness…priced Double Stout midway between those of London porter and Burton pale ale, which led to complaints from the English brewers about the tax-dodging activities of their Irish competitors.
Unfortunately for those London brewers, unmalted barley did not receive a tax exemption in England, which gave Guinness a real advantage in the British trade.
Happoshu—The Relentless Avoidance of Malt
Taxes on individual beer ingredients continue to engender new beer styles today. In Japan in recent years, the beverage category called happoshu has encompassed a wide range of drinks that have little in common except their lower tax status.
Happoshu generally refers to a new style of light beer that has been created to avoid taxes on malt. Made with as much as 75 percent corn or rice adjuncts, the resulting brew is just as strong as typical Japanese lagers, yet costs much less. While that fact alone has made happoshu attractive to consumers, many complain about its lack of flavor.
However, the happoshu category—and its tax advantages—also includes brews made with ingredients not approved for use in beer. This means that Japanese craft brewers who want to experiment with fruits, spices or different grains may enjoy a lower tax rate. That also motivates some brewers to add ingredients they wouldn’t otherwise—sweet potatoes or bitter melon, for example—purely to qualify for lower tarrifs. Either way, the result is new flavor combinations for the consumer, made possible by the tax structure.