The bipartisan legislation introduced by U.S. Representative Andy Barr (R-KY) to provide much-needed tax breaks for the Kentucky bourbon industry recently became law as part of a larger year-end budget package.
"During my time in Congress, I made creating a level playing field for our bourbon distilleries a priority," said Rep. Barr on Jan. 21. “Lower excise taxes will allow distillers to invest in their products and create more jobs, and create a better business environment in central Kentucky. "
Rep. Barr led the Promoting economic growth through the Distilled Spirits Act or the AGED Spirits Act4284, with bill sponsor US Rep. John Yarmuth (D-KY). The legislation permanently extends the exception for the aging process of distilled alcohol from the production period for the purpose of capitalizing interest costs in accordance with the text of the law.
President Trump signed the measure in December 2020 under the Craft Beverage Modernization and Tax Reform Act (CBMTRA), which was included in the $ 2.3 trillion COVID-19 aid and government funding package.
As a provision within the CBMTRA, Rep. Barrs H.R.
The bill also lowers Federal Excise Tax (FET) rates on distillers and spirits. FET rates should expire on December 31, 2020 unless Congress acted to make them permanent or provide for an extension. If the CBMTRA hadn't passed, small brewery excise duties would have increased from $ 3.50 to $ 7 a barrel on Jan. 1. In the case of distilleries, taxes would have risen by 400 percent.
Company executives thanked Rep. Barr for his efforts to get the bill passed, including Amir Peay, owner of Old Pepper Distillery in Lexington, and Max Shapira, CEO and owner of Heaven Hill Distilleries. "This action by Congress improves the growing platform for the entire bourbon industry and creates the conditions for further expansion both domestically and internationally in the years to come," said Shapira.
The bill was also supported by several associations, including The Kentucky Distillers' Association and The Brewer's Association.