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Something to toast: Possible tax breaks for beer brewers, vintners

Lesley Clark, McClatchy Washington Bureau on

Published in News & Features

WASHINGTON -- Beer, wine and cider aficionados could be lifting a glass to the Republican-crafted tax bill.

One potential tweak would temporarily cut federal taxes on small craft beverages, delivering what brewers, wineries and distillers say would be a boost to their burgeoning industries.

The measure isn't in the Senate tax bill that senators are writing this week, but a group of Republican senators has proposed an amendment that would cut the taxes on barrels of beer and wine for two years.

The change would benefit both large and small operations, say lobbyists for beer, wine and distilled spirits, who note that every congressional district in the United States has a brewery, winery, distillery, importer or an industry supplier.

"These businesses are often cornerstones of their communities," the Beer Institute, Brewers Association, Wine Institute, WineAmerica, Distilled Spirits Council and American Craft Spirits Association said in a letter this week to Senate Finance Committee chairman Sen. Orrin Hatch, R-Utah. "Unfortunately, outdated regulations and tax laws impede the growth of these individual businesses."

It was unclear the committee would hold a vote on the proposal. Republicans are eager to finish work on their tax plan in the House and Senate and appoint a committee to reconcile the differences between the chambers. The House is expected to vote on its bill Thursday. The Finance Committee is hoping to finish writing its version this week.

The amendment's call for an increased tax credit for small wine producers is drawing opposition from the conservative activist groups, Americans for Prosperity and Freedom Partners, which included it in a list of amendments they say "would award corporate welfare to special interests."

In a letter to Hatch, the groups, backed by the industrialist Koch brothers, urged lawmakers to ignore the special carve-outs.

"Every dollar that goes to propping up special interests is a dollar that doesn't go to lowering rates and easing the tax burden for ordinary Americans," the letter says.

The amendment calls for a temporary, two-year reduction in the federal tax. The committee's top Democrat, Sen. Ron Wyden, D-Ore., who has co-chaired the Senate Bipartisan Small Brewers Caucus, introduced legislation in January that would make the cut permanent. Similar legislation has been introduced since 2015, but has never passed.


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