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Posts Tagged ‘tax’

How Distilleries and Spirits Brand Owners Can Take Advantage of the New Tax Laws

In late 2017, Congress passed the Craft Beverage Modernization and Tax Reform Act (CBMTRA) as part of the Tax Cuts and Jobs Act of 2017. The CBMTRA cut the Federal Excise Tax (FET) on distilled spirits from $13.50 a proof gallon to $2.70 a proof gallon for the first 100,000 proof gallons (approximately 52,631 9-liter cases of 80 proof spirits) removed from bond for consumption or sale in 2018 or 2019.

The rules for distilleries to qualify for the reduced FET are fairly straightforward. To take advantage of the reduced FET on their first 100,000 proof gallons removed from bond in 2018 and 2019, a distillery must distill or processthose spirits. TTB’s definition of “process” is somewhat broad, but includes mixing, rectifying, and bottling. Therefore, a distillery who purchases whiskey or vodka in bulk, and bottles it at their facility, should be eligible to pay the lower FET rate, provided they have not removed more than 100,000 proof gallons in the current calendar year, and the current calendar year is either 2018 or 2019.

Read the rest of this article here.

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alcohol beverages generally, distilled spirits


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Kombucha Law Webinar

Last week I had the honor of participating in AHPA‘s webinar on kombucha law. Part of the recording is above and here. The American Herbal Products Association has been active since 1982, and now has more than 300 food, beverage and supplement members. It was an honor because of the eminence of my co-presenters:

  1. Justin Prochnow, FDA lawyer at Greenberg Traurig, Denver
  2. Will Garvin, FDA lawyer at Buchanan Ingersoll, Washington
  3. Peter Evich, Lobbyist, Van Scoyoc Associates, Washington
  4. Art Libertucci, Consultant, The Buckles Group, Washington

Justin spoke on bottle bills issues. Will covered FDA labeling. Peter covered pending legislative issues. Art helped organize the webinar. I spoke on the various TTB issues raised by kombucha.

It was also an honor because the issues are so timely and challenging. Kombucha is surging in popularity. It raises difficult issues such as:

  1. is it beer, wine, cereal beverage, malt beverage, food, supplement, or some combination
  2. what TTB permits may be needed
  3. does it need FDA or TTB labeling, or both
  4. what taxes apply
  5. what penalties may apply, if you blow it

The entire video is about 2 hours, but I have chopped it down to the 30 minutes or so that covers the TTB issues (1-5 as listed above). The entirety, with about 20 minutes of questions and answers, is available from AHPA as here.

 

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