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View Full Version : The Small Distillery Excise Tax Act (HR 777)



StraightNoChaser
08-07-2011, 13:23
Just read about this on Facebook. I'm sure this is one piece of legislation we could all stand behind!


The Small Distillery Excise Tax Act (HR 777) will enhance expansion and encourage growth of the small, craft spirits manufacturing industry in the United States, creating a tax credit similar to that already available to small beer and wine producers.In a nutshell, this will lower the excise tax of $13.50 per proof gallon to $2.70 for any distiller producing less than 65,000 gallons annually.

Facebook support page: http://www.facebook.com/SupportAmericanCraftDistilling?sk=info

Bourbon Boiler
08-07-2011, 15:34
I don't know what the magnitude of this tax break really means to the distillers, but it certainly wouldn't hurt anything. I'd like to see micro-distilleries become a tourism generator like small wineries have become in some regions.

StraightNoChaser
08-07-2011, 16:18
At the very least, I hope the savings are passed down to the consumer for these boutique spirits that are popping up everywhere.

emr454
08-07-2011, 20:13
Anything that makes it easier to make more whiskey, I suppose I support it (as we all here should!).

tmckenzie
08-08-2011, 02:05
It will be a big boost for the small folks. I agree with the tourism idea. We are right on the Seneca lake wine trail and we can see 400 folks on a good saturday. One of the biggest mistakes being made by small disitllers I think is locating an an industrial park. No tourism there.

cowdery
08-08-2011, 09:59
If this passes I will immediately set up a chain of nominally independent, very efficient NGS (i.e., vodka) distilleries, each with a capacity of 64,999 gallons. I should be able to flood the market with cheap vodka at a retail price point of about half what the cheapest vodka sells for now within days of this law's enactment. Because it will be like a license to print money, I shouldn't have any trouble getting investors. Problem is, I'll also have tons of competitors. Small artisan distillers will, of course, get screwed.

The FET is such a huge part of the cost of producing distilled beverages that a break this big provides an irresistible incentive to turn the law to a purpose for which it was not intended. I don't think this has any chance of passage for that reason.

Something more like a 25% break, which would take it to $10.13, would be some help but probably wouldn't provide enough incentive for a scenario such as the one I described.

More likely is an FET increase for all. We're broke, remember.

The interesting thing is that because the FET is based on proof volume, not price, the increase will be much less noticeable in a $40 bottle than it will be in a $20 one, which will actually be good for the micros.

tmckenzie
08-08-2011, 12:43
good point Chuck. I had not thought of it that way.

bgageus
08-08-2011, 12:47
Do we know of any small distillery in NY?

Rep Hinchey, Maurice D. (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD(FLD003+@4((@1(Rep+Hinchey++Maurice+ D.))+00541))) [NY-22] (introduced 2/17/2011) Cosponsors (http://thomas.loc.gov/cgi-bin/bdquery/z?d112:HR00777:@@@P) (4)
Latest Major Action: 2/17/2011 Referred to House committee. Status: Referred to the House Committee on Ways and Means.
COSPONSORS(4), ALPHABETICAL [followed by Cosponsors withdrawn]: (Sort: by date (http://thomas.loc.gov/cgi-bin/bdquery/z?d112:HR00777:@@@N))
Rep Michaud, Michael H. (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD(FLD004+@4((@1(Rep+Michaud++Michael+ H.))+01730))) [ME-2] - 6/14/2011
Rep Pingree, Chellie (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD(FLD004+@4((@1(Rep+Pingree++Chellie) )+01927))) [ME-1] - 5/3/2011
Rep Rahall, Nick J., II (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD(FLD004+@4((@1(Rep+Rahall++Nick+J.++ II))+00940))) [WV-3] - 7/14/2011
Rep Terry, Lee (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD(FLD004+@4((@1(Rep+Terry++Lee))+0156 6))) [NE-2] - 5/3/2011

StraightNoChaser
08-08-2011, 13:04
Do we know of any small distillery in NY?

Rep Hinchey, Maurice D. (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD%28FLD003+@4%28%28@1%28Rep+Hinchey++ Maurice+D.%29%29+00541%29%29) [NY-22] (introduced 2/17/2011) Cosponsors (http://thomas.loc.gov/cgi-bin/bdquery/z?d112:HR00777:@@@P) (4)
Latest Major Action: 2/17/2011 Referred to House committee. Status: Referred to the House Committee on Ways and Means.
COSPONSORS(4), ALPHABETICAL [followed by Cosponsors withdrawn]: (Sort: by date (http://thomas.loc.gov/cgi-bin/bdquery/z?d112:HR00777:@@@N))
Rep Michaud, Michael H. (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD%28FLD004+@4%28%28@1%28Rep+Michaud++ Michael+H.%29%29+01730%29%29) [ME-2] - 6/14/2011
Rep Pingree, Chellie (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD%28FLD004+@4%28%28@1%28Rep+Pingree++ Chellie%29%29+01927%29%29) [ME-1] - 5/3/2011
Rep Rahall, Nick J., II (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD%28FLD004+@4%28%28@1%28Rep+Rahall++N ick+J.++II%29%29+00940%29%29) [WV-3] - 7/14/2011
Rep Terry, Lee (http://thomas.loc.gov/cgi-bin/bdquery/?&Db=d112&querybd=@FIELD%28FLD004+@4%28%28@1%28Rep+Terry++Le e%29%29+01566%29%29) [NE-2] - 5/3/2011
Tuthilltown Spirits? Although I don't really know just how small their production scale is

cowdery
08-08-2011, 15:45
Tuthilltown is leading the charge, and they are small enough. Who wouldn't be for it? I am. I'm thinking "Five Buck Chuck" as the name of my vodka, available only in 1.75 L plastic. I'm gonna be rich, finally.

ebo
08-08-2011, 18:44
Tuthilltown is leading the charge, and they are small enough. Who wouldn't be for it? I am. I'm thinking "Five Buck Chuck" as the name of my vodka, available only in 1.75 L plastic. I'm gonna be rich, finally.
You won't be making any profits off of me. I'm not a big Vodka fan. :grin:

cowdery
08-08-2011, 19:42
You won't be making any profits off of me. I'm not a big Vodka fan. :grin:

I'm sure my millions will be sufficient consolation.

emr454
08-08-2011, 20:14
Do we know of any small distillery in NY?


Finger Lakes Distilling is in NY.

Eric

StraightNoChaser
08-09-2011, 07:22
Tuthilltown is leading the charge, and they are small enough. Who wouldn't be for it? I am. I'm thinking "Five Buck Chuck" as the name of my vodka, available only in 1.75 L plastic. I'm gonna be rich, finally.
I think you're serious :lol: :bowdown:

cowdery
08-09-2011, 10:32
Does anyone see any holes in my business plan?

StraightNoChaser
08-09-2011, 10:43
Yes, you haven't offered me a job!

callmeox
08-09-2011, 11:18
Does anyone see any holes in my business plan?

The winery who sells Two Buck Chuck wines will sue your ass for copying their name?

cowdery
08-09-2011, 11:26
The winery who sells Two Buck Chuck wines will sue your ass for copying their name?

No they won't. They're too cheap.

How about "Smirenough"?

I'll probably just call it "Crotchety."

ebo
08-09-2011, 13:28
No they won't. They're too cheap.

How about "Smirenough"?

I'll probably just call it "Crotchety."
"Crotchety Vodka"... it has a nice ring to it.:lol:

craigthom
08-09-2011, 15:00
The winery who sells Two Buck Chuck wines will sue your ass for copying their name?

"Two Buck Chuck" is a nickname created by customers for the Charles Shaw line.

Trader Joe's owns Charles Shaw, not a winery, and I'd be shocked if only one winery has produced it.

They may have registered the nickname as a trademark after the fact, but I'm sure "prior art" can be found on the Web, so our Chuck can fight it.

sku
08-09-2011, 16:18
"Two Buck Chuck" is a nickname created by customers for the Charles Shaw line.

Trader Joe's owns Charles Shaw, not a winery, and I'd be shocked if only one winery has produced it.



Actually, while Trader Joe's is the main (maybe now exclusive) retailer to market Charles Shaw, they don't own it. It's owned by the Bronco Wine Company which, as you noted, buys bulk wine for the label.

barturtle
08-09-2011, 18:03
Actually, while Trader Joe's is the main (maybe now exclusive) retailer to market Charles Shaw, they don't own it. It's owned by the Bronco Wine Company which, as you noted, buys bulk wine for the label.

Not exclusive, as in many states, if it's on the distributor's list, any licensed premises may purchase it. I recall this being an issue when Trader Joes moved into some state or another.

smokinjoe
08-09-2011, 18:20
"Two Buck Chuck" is a nickname created by customers for the Charles Shaw line.

Trader Joe's owns Charles Shaw, not a winery, and I'd be shocked if only one winery has produced it.

They may have registered the nickname as a trademark after the fact, but I'm sure "prior art" can be found on the Web, so our Chuck can fight it.

Oh yes, Chuck can not only fight it, he will will WIN it.

Remember....

Chuck Cowdery does not hunt, because the word hunting infers the probability of failure. Chuck Cowdery goes killing.

When the Boogeyman goes to sleep every night, he checks the closet for Chuck Cowdery.

Chuck Cowdery counted to Infinity...Twice.

Chuck Cowdery's tears cure cancer. Too bad he never cries.

If you see Chuck Cowdery, he can see you. If you can't see Chuck Cowdery, you may be only seconds away from death.

Even Chuck Norris fears Chuck Cowdery...

tmckenzie
08-10-2011, 03:18
I think everybody on adi forums thinks Chuck is the boogey man. They do not understand what he is saying is for their own good.

craigthom
08-10-2011, 12:20
Actually, while Trader Joe's is the main (maybe now exclusive) retailer to market Charles Shaw, they don't own it. It's owned by the Bronco Wine Company which, as you noted, buys bulk wine for the label.

I stand corrected.

There's no Trader Joe's in Louisville (yet! The space is being remodeled as we type), but friends in California tell me that Two Buck Chuck was great until it became popular and the original glut wine was replaced by cheaper stuff. It's still a value, but it's not as good. I think that wine labels need to list the winery or wineries, although probably the best they could do is "contains wine from one or more of the following".

I haven't been keeping up. Is the wine glut over? I know that there were other "rectifiers" like this one, and a lot of wineries introduced budget lines.

PaulO
08-10-2011, 13:09
I don't know if this is just hear say but, I thought $2 Chuck ($2.99 in IN) story was that a guy set up a winery with all new modern equipment and then just bought the grapes that were left at the end of the harvest. The big labels always had to grow some extra, so they never ran out.

ILLfarmboy
08-10-2011, 17:56
The FET is such a huge part of the cost of producing distilled beverages that a break this big provides an irresistible incentive to turn the law to a purpose for which it was not intended. I don't think this has any chance of passage for that reason.


Yes, most definitely, on both accounts.

But why would this loophole be a bad thing?

Should I want booze to have an infated price point because of the FET?

White Dog
08-10-2011, 20:59
I don't know if this is just hear say but, I thought $2 Chuck ($2.99 in IN) story was that a guy set up a winery with all new modern equipment and then just bought the grapes that were left at the end of the harvest. The big labels always had to grow some extra, so they never ran out.

Don't believe this urban legend.

White Dog
08-10-2011, 21:01
Actually, while Trader Joe's is the main (maybe now exclusive) retailer to market Charles Shaw, they don't own it. It's owned by the Bronco Wine Company which, as you noted, buys bulk wine for the label.

And Bronco Wine Company is owned by Fred Franzia, who happens to be a convicted felon.