Monthly Archives: June 2015

New Excise Tax Structure on the Horizon?

Most alcoholic beverage producers would agree taxes rank low on the list of their favorite things about their job. And it isn’t just the payments that stink; it’s figuring out who to pay, how much to pay, and when. New legislation introduced last week in the Senate is touting promises of reduced rates of excise tax on wine, and simplification of rules regarding records, statements, and returns.

Senate Bill 1562, informally called The Craft Beverage Modernization and Tax Reform Act, is an evolution of a number of similar pitches floating around throughout the alcohol industry. Bill 1562 would attempt to solve issues across the alcohol industry by covering taxpaying brewery, distillery, cidery, and winery operators.

In the winery world, the Bill would make the following notable changes:

  • Alcohol content for “table wine” would increase from 7-14% alcohol by volume to 7- 14.25%.
  • The Small Producers Tax Credit eligibility would increase in availability to wineries producing up to 250,000 gallons annually to 2,000,000 gallons produced annually.
  • A credit of $1.00 per gallon on the first 30,000 gallons of wine for all producers, excluding sparkling or carbonated wines.
  • A $.90 per gallon credit for all wine produced beyond 30,000 gallons and up to 100,000 gallons, if total production is less than 2,000,000 gallons per year. If production is between 1,000,000 and 2,000,000 gallons the credit is reduced 1% for every 10,000 gallons produced in excess of 1,000,000.

Bill 1562 would also allow wineries with tax liability of $50,000.00 or less to file their taxes on a quarterly basis, and would remove the bonding requirement. An additional change would allow annual tax filing for wineries expecting to owe less than $1,000.00 in excise tax.