In an effort to level the playing field with winemakers and craft brewers, new legislation was proposed in the House of Representatives on February 25, 2014 that would greatly reduce the federal excise tax rate on craft distillers. Congressman Chris Gibson filed the bill. HR 4083, which is named the “Distillery Excise Tax Reform Act of 2014”.
Under the bill the excise tax rate of $13.50 per proof gallon would be reduced to $2.70 for the first 100,000 proof gallons produced annually. After 100,000 proof gallons are produced in a year, the rate for subsequent production would increase to $13.50.
Passage of this legislation should help spur economic growth for craft distillers. With additional money available, distillers will be able to expand operations, invest in development of their product, improve their premises and hire additional workers. Furthermore, passage of the legislation should promote additional individuals and companies to begin craft distillery production.