OnTap Magazine

W hile sake is Japan’s traditional drink, beer is a major part of Japanese drinking and dining culture. Walk into any izakaya (pub) in Japan and you’ll find people enjoying cold, crisp beers, many of which will fall into the category of ‘happōshu’ . It would be easy to think happōshu is a style of Japanese beer – it looks and generally tastes like beer; perhaps a pale lager, or blonde ale. But, it is in fact a ‘beer-like’ low malt beverage, a category- arising from Japan’s liquor tax laws. You can call it a beer, but it cannot be labelled a beer. Happōshu exists because Japan’s tax onbeer is basedonmaltedbarley content, not alcohol; the greater the malt volume in the brew, the more tax the brewer must pay. In Japan, alcoholic malt beverages are split into three tax categories. The highest tax bracket is traditional beer or bīru , made with a minimum of 50% malt, with permitted adjuncts limited to barley, wheat, rice, corn, potatoes, sorghum, sugar and starch. Then comes happōshu, or ‘low malt beverage’, made with less than 50% malt, with a sub tax bracket for versions that use less than 25% malt. The remaining portion of the grain bill is made up of adjuncts, with a host of ingredients allowed, including fruit and spice. The last category, with the lowest tax levied, is ‘third beer’ or daisan bīru , typically referred to as ‘new genre (shin janru) beer’. These are essentially non- malt brews made from soybeans, pea protein or corn. THE GERMAN CONNECTION Japan got its first taste of beer in the 17th century when Dutch traders introduced it. But its popularity only began to rise after 1869, when a Norwegian-American brewer, William Copeland, brought German brewing techniques and traditions to Japan. Copeland founded the Spring Valley Brewery in Yokohama and served German style beers, using European ingredients in accordance with the Reinheitsgebot , meaning beer must be made only from malt, hops, water and yeast. In 1885, the then failing Spring Valley Brewery’s equipment was sold to the Japan Brewing Company, which would later become one of Japan’s major breweries: Kirin Brewery Company. This marked the start of the modern era of Japanese beer with brewers innovating local styles and using local ingredients, but still heavily influenced by German tradition. Japanese beer culture is all about the lager – pale in colour, refreshingly crisp, dry and light with an average 5% ABV, and revered for its quality. And it’s not only the liquid. The beer foam is also a mark of quality – the ratio of foam to liquid is much higher in Japanese lagers and its importance has led to the redesign of dispense taps and glassware to optimise it. Lagers account for almost 90% of the beer market and four major brewers supply the majority of the beer in Japan: Kirin, Suntory, Sapporo and Asahi. THE BIRTH OF HAPPŌSHU In an attempt to give Japanese brewers a competitive advantage over cheaper imports of beer, revisions to the liquor tax law in 1989 led to the introduction of happōshu during the 1990s, as a low-malt low-tax beverage. At the time, up to 67% of the grain bill could be malt, but it was taxed at a much lower rate than beer. Although happōshu existed before being officially categorised (in the form of craft and imported beers), the very first official happōshu was Suntory’s Super Hops. At 65% malt it was pretty close to their beer offerings. Next came Sapporo Drafty using less than 25% malt, meeting the even lower tax bracket. It tasted pretty much like beer; and, with the additional saving on the grist bill it set a new bar. With the launch of Kirin Tanrei in 1998, happōshu sales were almost equal to those of beer. The major brewers began expanding their product lines with low- priced happōshu alternatives to their core brands, and investing in their development and commercialisation. However, Japan’s National Tax Agency soon realised it was missing an income opportunity; and in 2003 raised the tax on happōshu. Consequently, ‘third beer’ or new genre beers were introduced to creatively circumvent the progressive tax hikes. NEW TAX, NEW INNOVATION There have been successive iterations of the beer tax laws since 1953. In 2018 the minimum malt content for beer was lowered to 50% and the approved list of permitted adjuncts expanded to include botanicals. In the latest and current change, made in October 2020, Japanese craft brewers are continually mastering the art of making lagers, ales and stouts, creating iconic new flavours and brands, but with a unique Japanese twist. And with now almost 300 craft breweries in Japan there’s a wide variety to whet your appetite. Reflecting the seasons, Japanese brewers will experiment with natural ingredients from yuzu, citrus and other fruits, to sweet potato, Japanese pepper, and oysters. Some aim to create the ultimate in ‘umami’ with matcha, seaweed and even bonito flakes. CRAFT IN JAPAN The majority of craft brewers in Japan brew craft happōshu the National Tax Agency implemented a five-year strategy to standardise the tax imposed on alcoholic malt beverages, aimed at unifying the taxes for all three categories by October 2026. The single liquor tax category will be called ‘beer flavoured effervescent alcoholic beverage’. And this new definition for beer will allow an expanded use of ingredients currently limited to happõshu and new genre beverages, such as fruits, spices, herbs, and honey. In the 2020 revision, tax on regular beer was reduced, while that for new genre beer saw an increase, with happōshu remaining the same. Another revision is expected in October 2023, further reducing tax on beer and increasing it on new genre ‘beer’. The 2026 single tax rate is likely to improve beer’s competitiveness against other alcoholic beverages and so improve beer sales in general over the long term. But, will enough consumers used to drinking lower priced happōshu be lured back to beer? Will consumers now willingly pay more for happōshu? The industry consensus is that there will be opportunities to innovate across all categories, especially in the short term with new genre and happōshu. Many Japanese consumers consider these as ‘healthy brews’ at an affordable price, due to the low/no alcohol and low carb or sugar content. THE ART OF JAPANESE CRAFT Homegrown craft beer (known as ji-biru ) is becoming more diverse, available and much more appreciated. The craft label is given to a brew irrespective of the ontapmag.co.za | Spring 2021 | 33