Cuts to Excise Taxes Would Benefit Brewers, Distillers, Vintners | Eastern North Carolina Now

    Publisher's note: The author of this post is John Trump, who is managing editor for the Carolina Journal, John Hood Publisher.

    The fate of the Republican tax bill is tenuous at best, but suspended deep among its many provisions are measures benefiting brewers, vintners, and distillers.

    An amendment by Sen. Rob Portman, R-Ohio, would slash excise taxes on beer, wine, and liquor.

    Sen. Ron Wyden, D-Oregon, seeks to make the cuts permanent, as they would expire after two years under Portman's amendment.

    The move would certainly help the heavily taxed industries, including the nascent brewers, winemakers, and distillers in North Carolina. The state has more than 200 brewers and about as many wineries. It also has more than 40 operating distilleries.

    The Distilled Spirits Council of the U.S., a national lobbying group, wrote Sen. Orrin Hatch, R-Utah, to express its support of Portman's amendment to the Craft Beverage Modernization Act.

    The current federal excise tax on distilled spirits is $13.50 per proof gallon, amounting to $5.5 billion in federal excise taxes in 2016, says DISCUS.

    The group goes on:

    "Fifty-four percent of the price of a typical bottle of distilled spirits is consumed by taxes and fees. This bill reforms the federal excise tax on spirits by:

• Establishing a reduced rate of $2.70 per proof gallon for the first 100,000 proof gallons of distilled spirits produced or imported annually for spirits.
• Establishing a rate of $13.34 per proof gallon for the next 22,130,000 proof gallons of distilled spirits.
• Keeping the excise tax rate of $13.50 per proof gallon for production in excess of 22,230,000 proof gallons."
• For beer, the amendment would lower the tax to $16 per barrel, from $18, on the first six million barrels brewed and to $3.50 per barrel for small brewers on the first 60,000 barrels produced domestically.

    Taxes on wine are more complex, but CNN Money explains the cuts:

• "The proposal aims to reduce the excise taxes to $1 per gallon for the first 30,000 gallons produced or imported, 90 cents per gallon on the next 100,000 gallons, and 53.5 cents per gallon on the next 620,000 gallons. It also raises the amount of alcohol for the lowest taxable increment of wine from 14 percent to 16 percent."

    "The beverage alcohol industry remains one of the most regulated industries in America," writes DISCUS. "Brewers, winemakers, and distillers pay state, local, and federal taxes on their production. Federal excises taxes, which are regressive taxes, are simply too high."