In late 2017, Congress passed the Craft Beverage Modernization and Tax Reform Act (CBMTRA) as part of the Tax Cuts and Jobs Act of 2017. The CBMTRA cut the Federal Excise Tax (FET) on distilled spirits from $13.50 a proof gallon to $2.70 a proof gallon for the first 100,000 proof gallons (approximately 52,631 9-liter cases of 80 proof spirits) removed from bond for consumption or sale in 2018 or 2019. The rules for distilleries to qualify for the reduced FET are fairly straightforward. To take advantage of the reduced FET on their first 100,000 proof gallons removed from bond in 2018 and 2019, a distillery must distill or processthose spirits. TTB’s definition of “process” is somewhat broad, but includes mixing, rectifying, and bottling. Therefore, a distillery who purchases whiskey or vodka in bulk, and bottles it at their facility, should be eligible to pay the lower FET rate, provided they have not removed more...Continue Reading Leave a Comment
How Distilleries and Spirits Brand Owners Can Take Advantage of the New Tax Laws
I always sort of knew my wife would end up in Time Magazine, with Donald Trump and a bottle of whiskey. The Time article about Margie Lehrman, ACSA, whiskey -- and even George Washington -- is here. The key part says: What is bad news for consumers is worse news for distillers in the U.S. says Margie Lehrman, executive director of the American Craft Spirits Association — especially small and medium-sized businesses. “The EU is a very important market for craft producers who have really boomed in recent years, creating 20,000 new jobs,” she says. “The President should consider the impact not only on the companies but also on the communities that they’re working in. These distilleries have often brought life and even tourism to run-down parts of towns, that previously people just didn’t go to.” Lehrman also questions the sincerity of Trump’s “America First” rhetoric. “It’s a shame whiskey...Continue Reading Leave a Comment
I was fully prepared to do a whole bunch of client work on this quiet day after Easter, but then Jaycee showed me a new Industry Circular. It is 2018-2, entitled Expansion of Allowable Changes to Approved Alcohol Beverage Labels. It adds some interesting new allowances, beyond the many set out here and here and here, etc. At first, the Circular looked pretty text-y and so it was hard to gauge the significance. To make it more visual, I prepared the above. It is easier to comprehend if you click on it, to expand it into its full glory (with all due apologies to Four Roses for monkeying with their back label). TTB seems to be on a roll, to expand the allowable revisions. It is quite a departure from the agency of a decade or two ago, not especially enamored of such changes. I wonder to what extent these allowable...Continue Reading Leave a Comment
Apothic Brew – Wine + Coffee for Real?
I most definitely did not see this one coming. I can imagine a lot of oddball combinations, but I would not have expected anyone to combine red wine and coffee. The news of this product just came in a few minutes ago via Wine & Spirits Daily. Though the combination does not sound like the best, to me, I wouldn't mind trying it, especially since the graphic design is so nice. The wine aspects are very much downplayed, on the main display panel. The UPC-side label makes it clear that the product is RED WINE INFUSED WITH COLD BREW COFFEE. E. & J. Gallo's approval for this wine is here. Gallo's press release says the product is rolling out April 1st, and it's no joke; Apothic's winemaker said: Last year during the long hours of harvest, I joined the cold brew craze myself. ... Quickly, I realized that many of...Continue Reading Leave a Comment
This is not quite the Trump Vodka of yore, but it is quite Trumpy nonetheless. Don't you think so? The whiskey on the left is America First Whiskey, approved for a DSP in San Marcos, California. I believe I see some sharks and monster trucks to go along with the tanks, jets, and deltoids. I found a discussion about the goals for this label, and it appears that the designer nailed it: "We want people who love Donald Trump and the idea of "Make America Great Again" to look at this logo and say 'Hell yes! That's the whiskey I want!'" They also considered throwing in some fanny packs, and a T-Rex -- but perhaps that would go too far. The bottler proclaimed: "We're [making a whiskey for Americans] interested in Freedom, beards, rifles, explosions, The US Constitution, military/veterans, and reflecting on how badass Donald Trump is." The wine, on...Continue Reading Leave a Comment