Regular readers will know that I’ve discussed on many occasions the provisions of alcohol-related legislation introduced by Senator Ron Wyden of Oregon. In fact, we previously devoted more than a few bytes of space tracking the co-sponsors of Senator Wyden’s Craft Beverage Modernization and Tax Reform Acts of 2015, 2016 and 2017.
None of them were enacted – although certain provisions relating to the reduction of federal excise taxes on small spirits producers were enacted as part of the commonly (and incorrectly) called Tax Cuts and Jobs Act passed in late 2017. Those FET reductions are scheduled to sunset at the end of 2019, which would have the effect of catapulting the smallest spirits producers from their current obligation of $2.70 per proof gallon back to the pre-2018 rate of $13.50 per proof gallon.
So what’s a senator from Oregon to do? Reintroduce the bill of course – and so the Craft Beverage Modernization and Tax Reform Act of ….. wait for it ….. 2019 was born.
If enacted, the bill would make permanent (or at least as permanent as anything is with Congress) the FET reductions for smaller distillers and certain provisions relating to transfers in bond. And as with prior versions of the bill, it would provide beer and wine producers with certain benefits as well. Keeping with the tradition of the last version of the bill (but breaking with versions before that), the bill does not include a provision legalizing home distillation.
Candidly, that last piece feels a bit disingenuous, given that just a day or two after reintroducing this bill, the senior senator from the Beaver State introduced Senate Bill 420 (yes – 420) which would legalize marijuana at the federal level. But the fact is that Wyden’s weed bill is really more about regulation and taxation than it is legalization. And if you’re going to tax the daylights out of something (weed, booze or otherwise) – it probably doesn’t make that much sense to let people obtain it without the help and blessing of the government.
The full text of the Craft Beverage Modernization and Tax Reform Act of 2019 is here. A summary sheet is here. Stay tuned for periodic updates on the legislation.
HoochLaw 