• Tax Cut and Jobs Act Reduces Taxes for Alcohol Producers
  • March 5, 2018 | Authors: Kevin A. Halloran; Patricia A. Power
  • Law Firms: Bose McKinney & Evans LLP - Indianapolis Office; Bose McKinney & Evans LLP - Washington Office
  • The Tax Cut and Jobs Act (TCJA), enacted into law on December 22, 2017, reduces the rate of excise taxes on beer, wine and distilled spirits and increases the credit against tax for domestic producers of wine, sparkling and carbonated wine, as well as hard cider.

    This change in law is good news for alcohol producers as the savings could be significant, particularly for the bigger producers. By way of example, a winery producing 12,600 cases annually will save $3,000; 50,000 cases would save $20,010; 105,000 cases save $184,030; and over 315,390 cases would save $451,700. The rates of reduction in excise tax are outlined in the TCJA by alcohol type and volume, and certain definitions tied to alcohol content have been modified.

    It is important for all alcohol producers to understand these beneficial federal tax changes now because they are short lived. The excise tax reductions and other changes are effective in 2018 and 2019.