While much of the country sees the Senate’s tax reform bill as greedy, the tax-strapped booze industry is toasting with the good stuff right now. The drinks world received significant tax cuts and important federal definitions.
In a time, when the two major parties cannot agree on much, alcohol seemed to be bipartisan, albeit no Democrats voted for the final bill.
"These small businesses use Montana grain to make world-class beer and booze, and by cutting regulations and reducing taxes these made-in-Montana businesses can continue to support our state's economy," said U.S. Senator Jon Tester, Dem-Montana, in May.
U.S. Senator Luther Strange (Republican-Alabama) noted the bill provided a 50% reduction of federal tax on domestic brewers and distillers who produce less than 60,000 barrels a year. In September, Strange said the bill would boost his state’s craft distilleries and breweries, “revitalizing neighborhoods and creating jobs.”
After it passed, the Senate bill includes a two-year version of the Craft Beverage Modernization and Tax Reform Act, which defined mead, cuts the federal excise tax on spirits, wine and beer, allows in-bond transfers of bottled spirits and provides for the expensing of certain costs related to the aging process of beverage alcohol.
The Distilled Spirits Council President and CEO Kraig R. Naasz said the Senate tax reform bill will create a fairer tax structure for all beverage alcohol. “It will enable producers of distilled spirits to invest back in their businesses and communities across the United States,” he said. “Distilled spirits are among the most highly taxed consumer goods in the United States and we support the enactment of pro-growth, comprehensive tax reform.”
Fred Minnick is a national beverage writer. Sign up for his free drinks newsletter.