Happy Saint Patrick’s Day!
As the day winds down, many Americans will celebrate the close of the holiday with an Irish beer. And what’s more Irish on St. Patrick’s Day than a Guinness?
On an average day, Americans will drink about 600,000 pints of Guinness. But on St. Patrick’s Day, Americans will consume about five times that much, or 3 million pints (worldwide, the number will hit 13 million).

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Image from Guinness brewery, courtesy of Kelly Erb.

That’s a lot of beer – especially considering that the famous Guinness stout recipe wasn’t initially created in response to popular tastes but instead, a response to two specific excises taxes on coal and malt.
In 1752, 27-year-old Arthur Guinness set up a brewery using money inherited from his godfather. His brewery focused on ale, a style which was popular with the Irish working class.
A few years later, Guinness moved to Dublin where he signed a 9,000-year lease (yes, 9,000 years) on a small, unused property. He had intended to continue his focus on ale. At that time, however, a dark beer from London called a “porter” (since the city’s street and river porters tended to enjoy a pint) was becoming more popular. Guinness switched gears and started brewing a dark beer, too.
The switch to dark beer wasn’t merely a matter of taste. The brown color was generally attributable to the fact that beer-making at the time relied on brown malt cooked over a wood fire. Wood fires were cheap but hard to control. Coal fires were more manageable which meant that the temperatures were easier to manipulate. At higher temperatures, brewers could use less malt (as well as a different kind) to achieve the same result (alcohol) but with a slightly different look and taste: a kind of pale ale.
Coal, however, was subject to tax (downloads as a pdf). This was a relatively new development. The British had imposed an excise tax on beer since the 17th century which proved so useful as a revenue raiser that the government stepped up the imposition of excise taxes in the 18th century, adding a number of goods to the excise tax list – including coal.
The excise tax on coal made brewing pale ale expensive, which meant that production was typically left to larger breweries. Smaller brewers who marketed blends using the pale ales had to rely on the kindness of larger brewers: you can imagine that this created an uneasy relationship. As a result, over time, smaller brewers began experimenting with recipes which didn’t rely on those pale ales in order to become more independent. The result? Darker beers remained a staple – especially with the Irish working class who appreciated the relatively low cost. Guinness was happy to oblige and by the late 18th century, Guinness’ version of the porter was well known in Dublin and was distributed all over Ireland.
At the turn of the century, Guinness died and his son – also cleverly named Arthur – took over the family business in 1803. The second Guinness, however, made some changes. Specifically, he altered the family beer recipe to include unmalted roasted barley. He did so for extremely practical reasons: the unmalted barley wasn’t subject to heavy excise taxes imposed on malt. The lack of excise taxes made production more affordable for the brewery which was under financial pressures as excise taxes had increased on everything from glass to soap. Luckily, the unmalted barley also made the beer’s taste distinctive and Irish beer drinkers approved. Within a few decades, sales of the new beer, called a stout because of its alleged strength, were booming. By the end of the 19th century, Guinness was the largest brewery in Europe.
Today, if you pop over to Ireland, you can visit the brewery, which claims to be Ireland’s most popular tourist attraction. A tour of the Guinness Storehouse (we checked it out in January) gives you a glimpse into the brewing process as a well as a peek into the brewery’s history. You can top it off with a trip to the Gravity bar at the top where you can enjoy a nice pint of what’s affectionately called “the black stuff.”
Even if you don’t make it over to Ireland, you can still enjoy a pint at home. Today, Guinness is distributed in 150 countries and is enjoyed all over the world. And to think that the inspiration for what we know today as a stout was simply an effort to pay less in taxes. I think we can all drink to that: Sláinte!
 
 

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Kelly Erb is a tax attorney and tax writer.

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