The House of Representatives passed and sent to the Senate a bill that extend the Craft Beverage Modernization & Tax Reform Act (CMBTRA) for another year. The measure, which provides significant relief on Federal excise taxes to small distillers, brewers and wineries, had been scheduled to expire at the end of the year.
“This bill is critical to the day-to-day operations of craft distilleries nationwide, and its passage will be instrumental in their planning for the next year. We urge the Senate to pass this legislation swiftly to restore stability for these small businesses as soon as possible,” said Chris Swonger, president/CEO, Distilled Spirits Council of the U.S.
Swonger noted earlier that craft distillers across the country were facing a 400% tax increase beginning Jan. 1.
The Senate is expected to vote on the extension on Thursday and send it to the President for his signature on Friday. But if the measure doesn’t clear the Senate, or if President Trump doesn’t sign it, the American Craft Spirits Association said a survey of 100 craft distilleries across the country found:
- 100% of craft distillers report that the tax hike will negatively impact their small businesses.
- More than 50% of craft distillers will take action to immediately cut jobs.
- 15% of craft distillers will cut production.
- 12% of craft distillers will halt any expansion efforts.
- 13% of craft distillers will increase pricing.
- 11% will cancel or stop negotiating equipment purchases.
- 5% will cut grain purchases, creating a direct impact on U.S. agriculture.
- 5% will be forced to close their doors almost immediately
We don’t have estimates yet from beer and wine, but we expect similar numbers.
This story is developing and will be updated.