The House of Representatives passed a far-reaching overhaul of the U.S. tax code, reducing the corporate tax rate to its lowest point since 1939 and cutting individual taxes for most households next year.
But, unlike the measure pending in the Senate, it didn’t incorporate essential provisions of the Craft Beverage Modernization and Tax Reform Act, which would lower the federal excise tax for beer, wine and spirits.
That was disappointing – but not a surprise – for Brewers Association CEO Bob Pease. We caught up with him late this afternoon, and he told us the Senate version of CBMTRA has “broad, bipartisan support. They see the benefit of what this bill would do for our members. For most, it would cut the federal excise tax (FET) burden in half. Our members would take that money, reinvest in physical plant, expand their operation. When craft brewers expand their operation, they hire more workers.”
Pease noted that the Brewers Association is part of a bev/al coalition that includes all the major associations. “We’re all very supportive of Sen. Portman’s amendment,” inserting CBMTRA into the Senate tax reform bill, and “very appreciative of Sens. Portman, Widen and Blunt.”
Assuming the Senate bill passes with CBMTRA included, we wondered what the odds were that the craft beverage provisions would be included in the final legislation, after House and Senate representatives met in conference.
Pease noted that 295 House members are co-sponsors of CBMTRA, as are 55 Senators and said he hoped that level of support would keep CBMTRA provisions in the final bill.
What are the odds of that, we wondered. “Our chances seem to change by the hour,” he responded.
The Portman amendment, including CBMTRA would expire in two years. That’s apparently tied to scoring of the bill by the Joint Committee on Taxation. Pease expressed hope the final conference version would make the excise tax cuts permanent.
Craig Wolf, president, Wine & Spirits Wholesalers of America praised the House for passing its tax reform plan:
“Today, the House of Representatives moved one step closer to enacting tax reform that will not only benefit family-owned wine and spirits wholesalers, their 74,000 employees at 3,000 facilities across the country, but also countless small and family-owned businesses nationwide. This is a significant accomplishment and the House deserves credit for taking an important step toward making tax reform a reality.
“WSWA thanks the House for preserving the LIFO method of accounting and recognizing the importance of a fair rate for family-owned pass through businesses. We plan to work with the Senate to make these pillars of tax policy a reality.
“Tax reform will energize our economy, enable businesses to invest more in employees, benefits, and training as well as facilities and equipment. That is why it is essential that the Senate quickly pass, and the President sign into law, permanent and lasting tax reform.”