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News
US distillers gain support for permanent tax cuts
Congressional support for legislation that gives a federal tax cut for craft brewers and distillers in the US has received a “record” number of co-sponsors.
Support in the US grows for the Craft Beverage Modernization and Tax Reform Act to be made permanent
A total of 315 co-sponsors of the US House of Representatives and 73 in the US Senate have pledged their support for the Craft Beverage Modernization and Tax Reform Act.
The support comes following a ‘day of action’, which resulted in more than 10,000 engagements from more than 3,000 individuals urging their members of Congress to support the passage of the bipartisan legislation.
A two-year version of the Craft Beverage Modernization and Tax Reform Act was introduced in 2018 as part of US president Donald Trump’s US$1.4 trillion tax reform bill.
The act provided domestic brewers and distillers who produce fewer than 60,000 barrels a year with a 50% reduction on federal tax.
If the legislation is not made permanent, alcohol producers will face an increase in federal excise taxes from 1 January 2020.
Chris Swonger, president and CEO of Discus, said: “For the last two years, the Craft Beverage Modernization and Tax Reform Act has enabled distilleries across the United States to expand their businesses, create jobs and reinvest in their communities.
“Without this critical piece of legislation, that growth could come to a halt. There is no doubt this bill has broad support. It is time for Congress to act and provide the stability distillers need to continue to generate new jobs and support local agriculture and tourism.”
Numerous trade bodies, including the Beer Institute, Brewers Association, Discus, the American Craft Spirits Association, Wine Institute, Wine America, the United States Association of Cider Makers, and the American Mead Makers Association, welcomed the congressional support for the bill.
Margie AS Lehrman, CEO of the American Craft Spirits Association, said: “Federal excise tax reform has dramatically helped to stimulate craft spirits growth, and a permanent relief is critically important to securing the future of our industry.
“Without permanent immediate reform, the stability of this vibrant industry is bound to be paralysed. And without the certainty of a long-term reduction, it is impossible for any new or existing distillery to implement a business plan when the wide tax variable threatens the ability to hire new employees, purchase equipment, provide staff benefits and continue to grow.”