ALCOHOL LAW ADVISOR
ALCOHOL LAW ADVISOR
Regulatory and Distribution Law Updates for the Alcohol Industry
ALCOHOL LAW ADVISOR
Regulatory and Distribution Law Updates for the Alcohol Industry
Tax Cuts and Jobs Act
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Federal Alcohol Excise Taxes 101

There are many laws at both the federal and state level that govern the production and distribution of distilled spirits. For example, craft distillers must comply with licensing and permitting requirements, trade practice laws, advertising restrictions, and, depending on the jurisdiction, alcohol franchise law. One of the most fundamental—and most complex—areas of law governing distilled spirits is excise taxes. An article authored by McDermott’s Bethany K. Hatef in the Winter 2020 issue of Artisan Spirit Magazine provides a high-level overview of the federal alcohol excise tax system and some specific features that apply to distilled spirits, and also explains the current status of the Craft Beverage Modernization Act, the legislation temporarily providing for reduced tax rates for certain amounts of distilled spirits. Access the full article. Originally published in Artisan Spirit Magazine: Winter 2020.

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TTB in a Deregulatory Mood

Changes in Administration and other political shifts can have subtle and, occasionally, not-so-subtle influences in the Alcohol and Tobacco Tax and Trade Bureau (TTB) policies and priorities. In the article, “TTB in a Deregulatory Mood” published by Artisan Spirit, Marc Sorini explores how the Trump Administration’s desire to reduce regulatory burdens on business has already influenced TTB’s regulatory priorities. Particularly, in the most recent “Unified Agenda,” a bi-annual compilation of federal regulatory initiatives, TTB placed a priority on deregulatory projects, several of which would alter the regulatory environment for the industry. Marc discusses how the change in administration appears to have an effect on TTB’s rulemaking efforts. Access the full article. Originally published in Artisan Spirit, Spring 2018.

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Additional TTB Tax Act Guidance

On Thursday evening, February 1, the Alcohol and Tobacco Tax and Trade Bureau (TTB) released additional FAQ guidance on the alcohol excise tax provisions of the 2018 tax reform (the Tax Act). Imports: Echoing a January 31 pronouncement by Customs and Border Protection, TTB has instructed importers to continue paying the full rate of excise tax until it can establish the procedures by which foreign producers can assign their tax credits to US importers. TTB promises to give importers the opportunity to seek excise tax relief (refunds) on entries made after the law went into effect, once procedures and guidance have been issued. Wine: TTB interprets the Tax Act’s tiered tax structure as requiring a precise determination of which removals were “first” when deciding how to divide the excise tax credits between the credits (as high as $1/gallon) available for most wines and the credits (only as high as ¢6.2/gallon) available for wine taxed at the “hard cider”...

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Excise Tax Relief for Breweries, Wineries and Distilleries

This post does not constitute tax advice. It summarizes changes in alcohol beverage excise tax laws to assist industry members in planning to implement the changes. Excise tax calculations and liability must be determined for each taxpayer based on numerous variables. The new tax law formerly referred to as the Tax Cuts and Jobs Act of 2017, provides a temporary reduction in alcohol beverage excise taxes for US brewers, winemakers, distillers and beverage importers. Temporary tax relief is available for beer, wine and spirits removed from a US manufacturing facility or released from Custom’s custody after January 1, 2018, and prior to December 31, 2019. Several provisions of the new law will require the Alcohol and Tobacco Tax and Trade Bureau (TTB) to quickly promulgate new regulations. The new law also modifies existing sections of federal excise tax laws so that commonly owned manufacturers and importers get "one bite at the apple" for each beverage...

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“Chairman’s Mark” Includes CBMTRA Provisions to the Tax Cuts and Jobs Act

America's brewers, distillers and wineries cannot yet raise a glass to recalibrated federal excise taxes, but they got one step closer to be able to do that on Tuesday. That is because the provisions of the Craft Beverage Modernization and Tax Reform Act (CBMTRA) (S. 236)—including the excise tax changes that would benefit America's small brewers, distillers and wineries—have been included in Senate Finance Committee Chairman Orrin Hatch's revised "Chairman's Mark" to the Tax Cuts and Jobs Act that is now being considered by the Senate Finance Committee. The inclusion of the CBMTRA is a very significant positive development for all producers of alcoholic beverages, but particularly for small brewers, distillers and wineries. Sen. Rob Portman (R-OH) offered an amendment to include the CBMTRA to the Chairman's "mark" to the underlying bill and Chairman Hatch agreed to that. Co-sponsors of Portman's amendment included Sens. Bill Cassidy (R-LA), Johnny Isakson...

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