In the seven years Iâve been writing this column, it has focused on classic beer styles and emerging craft favorites, but with this springâs sweeping changes in Japanâs alcohol tax laws, I feel compelled to address the bubbly, alcoholic elephant in the room. Happoshu is no style at all in the usual sense. Most drinks in this category are just low-malt pale lagers. Others are fruit beers, spice beers, beers with vegetables, seaweed, oysters or clams, or just about any non-traditional ingredient added. But the definition has changed, and we need to consider what this means for craft beer.
Although the category existed much earlier, happoshu as a low-tax, beer-flavored beverage was born in 1989 tax law revisions as an attempt to allow Japanese brewers to better compete with cheaper foreign imports. Under the new law, happoshu made with less than 67% malt would be taxed at a considerably lower rate than beer.
The first happoshu to take off was Suntory Super Hops in 1994, which, at 65% malt, was still pretty close to beer. Sapporo Drafty, released the following year, lowered the bar, using less than 25% malt for an even lower tax rate, and selling at „160 when beer averaged around „200. From that point, almost no happoshu used more than 25% malt. It made no senseâthey tasted nearly the same, but the tax was much lower. From 1998, Kirin Tanrei stole the show, quickly came to claim over half the happoshu market, and led happoshu sales to nearly equal those of beer. With that growth spurt, the national tax agency realized it was losing massive income and raised happoshu tax in 2003. This led to an even faster race to the bottom in the form of 3rd category beerâeither made without malt, or happoshu spiked with spirits.
Until March 31, 2018, the following type of beer-like alcoholic beverages were considered happoshu:
Those with less than 67% of their fermentable sugar coming from malt.Those that contained any ingredient besides hops, malt, barley, wheat, corn, sorghum, potatoes, sugar, rice, or starch.Those with any ingredient added to them after fermentation was completed (e.g. dry hopping after the yeast was removed).In the craft beer world, only classes 2 and 3 have been important.
As fans of craft beer know, however, there is another aspect to happoshu. While a brewery must annually produce 60kl to receive a beer license, only 6kl is necessary for a happoshu license. With the strict licensing process in Japan, the majority of craft âbeerâ brewers in this country are actually making craft âhapposhuâ, meaning that some form of spice, fruit, or other additive is included in their beers, or that they dry hop after fermentation ends. Of course, this happoshu is marketed as craft beer, and none of us really give it much thought.
In a nod to craft beer in Japan and around the world, the 2018 law recognizes that beverages containing various additives are generally considered âbeerâ, and allows the following additives to be included:
A. Fruits.
B. Coriander.
C. Pepper, cinnamon, clove, sansho and other spices.
D. Chamomile, sage, basil, lemongrass and other herbs.
E. Sweet potato, pumpkin and other vegetables.
F. Buckwheat and sesame.
G. Honey, salt, and miso.
H. Flowers, tea, cocoa, coffee.
I. Oysters, kombu, wakame, bonito flakes.
One might spend quite some time wondering just how these categories were decided on, but from now on, any of these ingredients may be included in beer, just as long as they do not surpass 5% of the weight of the malt used in brewing it. Furthermore, it is now also possible to add these things, as well as hops, to a fully fermented beer, and the percentage of non-malt fermentables needed to make a happoshu has been lowered to 50%.
What does this mean to craft beer lovers? Frankly, almost nothing. When craft brewers wanted to make a beer with additives, they generally just got a happoshu license and made it. This will make that extra step unnecessary, but then again, most craft brewers started with happoshu licenses anyway, so the number affected by this change will be quite small indeed. Laws about dry hopping have become more rational, but in the past, all that was necessary was to make sure some live yeast was left in a nearly-finished beer when the hops went in, so we shouldnât expect any sweeping changes there either. We need not even address the issue of malt content.
Happoshu breweries licensed before the change will still operate under the old law. The bigger affect will be on happoshu breweries that opened after April 2018. Instead of merely adding an unspecified amount of, say, coriander or tea to their recipes, these breweries will now have to use much moreâ5% of their malt bill. To flesh this out, consider a 100l batch of IPA brewed to 6% abv. This recipe calls for roughly 30kg of malt. So to brew it under a happoshu license, one would have to add 1.5kg of spice or fruit to the recipe. That would be fine if one wanted a fruit beer, but it will severely limit the ability to brew classic beer styles on a happoshu license. A witbier recipe that normally calls for 200g of spices will now need seven times that. Try to image what that would taste like!
In the end, this law looks mainly to benefit the Big Four industrial brewers in allowing them to make crafty âbeersâ full of different ingredients, and to thereby attempt to regain some of the market share they are losing to craft. Readers may have already tasted some of their new and ingenious creations, several of which I have written about on the JBT website.
While it makes obvious sense to allow spices and fruited beers to be called âbeer,â the best thing about this new law has nothing to do with happoshu definitions. The law also contains a plan to incrementally merge the tax rates for beer, happoshu, and ânew genreâ beverages, so that from October 1, 2026, all beverages will be taxed at a flat rate of „155/liter. This of course means lower taxes on all craft beverages, no matter what license they are brewed under.
Yet one problem remains. Because of the 5% rule, small-capacity breweries operating with a happoshu license will be more and more constrained in the beers they can make. They either need to use lots of additives, or they will have to be more creative in finding legal ways around the rules (this is indeed already happening, wink, wink!). The next logical step that still needs to be taken is to get rid of the 6kl / 60kl licensing distinction altogether. Itâs meaningless anyhow. There is no good reason whatsoever to suppose that someone with a 100L kit can make a fine fruit or spice happoshu, but not a good all-malt pilsner.
Once this distinction is lost, the embarrassment of happoshu and 3rd category beer can be forever wiped off the face of the Japanese beer scene, and people like me will no longer have to explain this confusing nonsense to foreign visitors. Come on, lawmakers, take it a step further! Oh, and while youâre at it, how about legalizing homebrewing as well?
All Beer Styles articles are written by Mark Meli, author of Craft Beer in Japan.
This article was published in Japan Beer Times # () and is among the limited content available online. Order your copy through our online shop or download the digital version from the iTunes store to access the full contents of this issue.
