HR 4083 Distillery Excise Tax Reform Act of 2013

[OldSpye]

It seems to me that the B-Fs and Diageos of the world are laying some serious money against this legislation.

Their concern is that it creates an irregular playing field between the micro and macro industries and that we would simply use the $11/gal tax break to offset our prices.

Of course, when a bottle of JD unaged Rye is pulling the better part of a $58 shelf price, I'd have to say they have a borderline legit concern, tax breaks notwithstanding.

The truth, of course, is entirely different. The truth is that the intent of the excise tax reduction is to compensate for the lack of economies of scale in the micro industry and actually level the playing field. Which, of course, is great for us but... the big boys don't like that at all.

[grehorst]

It seems to me that the B-Fs and Diageos of the world are laying some serious money against this legislation.

Their concern is that it creates an irregular playing field between the micro and macro industries and that we would simply use the $11/gal tax break to offset our prices.

Not sure where you've heard this, but it's wrong. Read the proposed bills. It allows ALL distillers to enjoy a reduced FET on the first 100,000 proof gallons. DISCUS members (including the two companies you mention) will support this because of that fact.

[Rickdiculous]

"DISCUS members (including the two companies you mention) will support this because of that fact."

Just Curious Guy, do you know of any that do support this outside of the craft distillers now in DISCUS? Because I would wonder why they would want to help out the competition who see $1,000,000 as a huge number, when the big guys see that as chump change. They probably spill a Million bucks in whiskey on the floor every year. They merely need to produce 100-200 barrels extra to create that number and they do that every hour. As Craft distillers are eating up market share, that is far more significant than any tax savings they will realize. If the impending whiskey shortage is truly coming, they may have an incentive to help us out, but I don't see the up side to this for them, financial or philosophical.

So when you say "Will Support" is that opinion or do you know they are supporting it?

[OldSpye]

Not sure where you've heard this, but it's wrong. Read the proposed bills. It allows ALL distillers to enjoy a reduced FET on the first 100,000 proof gallons. DISCUS members (including the two companies you mention) will support this because of that fact.

I won't disagree with the notion that they may support it, because as I said, I was pretty much speculating.

I'd be curious to know the answers to two questions, though:

1. Does roughly $1M in tax savings fully play out in their favor with all the other factors considered (given that they're producing millions of gallons a year), and,

2. If they're supportive of the legislation, they why has it gotten so little traction? I would think that they'd be able to glean some significant legislative support, particularly from their home state legislators.

[OldSpye]

Just this morning I sent letters to Congressman Chris Smith (R-NJ) as well as Senators Robert Menendez (D-NJ) and Cory Booker (D-NJ). I also posted something about the bill on our Facebook page. I would encourage everyone here to do the same. Given the current low level of support in both the House and the Senate, the only chance this bill has is if we turn up the heat, considerably.

[WishkahRiver12]

Have been in touch with Congressman Derek Kilmer's (D-WA) office about this. He and his staff will be visiting the distillery 6/5 to discuss further. I am urging him to become a co-sponsor.

Here is his latest reply to my email request for support;

Dear Joshua,

Thank you for contacting me about H.R. 4083, the Distillery Excise Tax Reform Act. I appreciate you taking the time to reach out to me on this issue.

Prior to joining Congress last year, I spent the last decade working in economic development for a living. When I worked at the Economic Development Board for Tacoma-Pierce County I met with roughly 200 businesses a year to try to help them grow and succeed. The issue of tax fairness and regulatory certainty were continual themes in those meetings.

It is critical that we reform tax policies that impede economic growth, ensuring we have a tax code that helps our small businesses succeed and encourages employers to invest in America.

Rep. Christopher Gibson (N.Y.) introduced the Distillery Excise Tax Reform Act. The bill would decrease the excise tax on spirits from $13.20 to $2.70 per gallon for the first 100,000 proof gallons produced in the calendar year. When I served in the State Legislature, I supported a number of bills focused on helping our craft distilleries (defined by the Washington State Liquor Control Board as distilleries producing less than 60,000 gallons a year).

I think this bill could be a real benefit to our craft distilleries, and I'm inclined to support it. I hope the House Ways and Means Committee will hold a hearing on this legislation so that we can see how to best support local distillery businesses. As the bill moves forward, I'll certainly keep your advocacy in mind.

I encourage you to continue to share your views with me on this topic and any other issue. Thank you for reaching out. It is an honor to serve as your representative.

Sincerely,

Derek Kilmer
Member of Congress

[Ralphie9]

Have been in touch with Congressman Derek Kilmer's (D-WA) office about this. He and his staff will be visiting the distillery 6/5 to discuss further. I am urging him to become a co-sponsor.

Here is his latest reply to my email request for support;

Dear Joshua,

Thank you for contacting me about H.R. 4083, the Distillery Excise Tax Reform Act. I appreciate you taking the time to reach out to me on this issue.

Prior to joining Congress last year, I spent the last decade working in economic development for a living. When I worked at the Economic Development Board for Tacoma-Pierce County I met with roughly 200 businesses a year to try to help them grow and succeed. The issue of tax fairness and regulatory certainty were continual themes in those meetings.

It is critical that we reform tax policies that impede economic growth, ensuring we have a tax code that helps our small businesses succeed and encourages employers to invest in America.

Rep. Christopher Gibson (N.Y.) introduced the Distillery Excise Tax Reform Act. The bill would decrease the excise tax on spirits from $13.20 to $2.70 per gallon for the first 100,000 proof gallons produced in the calendar year. When I served in the State Legislature, I supported a number of bills focused on helping our craft distilleries (defined by the Washington State Liquor Control Board as distilleries producing less than 60,000 gallons a year).

I think this bill could be a real benefit to our craft distilleries, and I'm inclined to support it. I hope the House Ways and Means Committee will hold a hearing on this legislation so that we can see how to best support local distillery businesses. As the bill moves forward, I'll certainly keep your advocacy in mind.

I encourage you to continue to share your views with me on this topic and any other issue. Thank you for reaching out. It is an honor to serve as your representative.

Sincerely,

Derek Kilmer

Member of Congress

More than I got from my guys...but we'll keep at them!

[OldSpye]

Definitely keep at them. As I posted on this topic in another thread, I haven't received any significant feedback from my own Congressman (Chris Smith, R-NJ4) but did get a letter from Senator Robert Menendez re: S.2169, which is the same bill as introduced into the Senate by Kirsten Gillibrand (D-NY).

I'm staying on top of Smith, as well. I've supported this guy for decades, and I'm more than a little miffed that he hasn't been more attentive.

For what it's worth, H.R.4083 now has 2 co-sponsors - Steve Strivers of Ohio and Ralph Hall of Texas.

[3d0g]

Got a call from Colorado representative Cory Gardner's office today (must say that's a first), and he'll be supporting H.R. 4083 if it comes to the floor.