Provides a tax credit to taxpayers who grow the base ingredients necessary for the production of beer

5 Co-sponsors

• Phil Boyle
• Leroy Comrie
• Jesse Hamilton
• George Latimer
• Marc Panepinto

Title of bill

An act to amend the tax law, in relation to providing a tax incentive to a taxpayer that grows base ingredients used for the production of beer

Purpose

This bill creates a tax credit for the agricultural production of ingredients needed for brewing and distilling.

Summary of provisions

Section 1: adds section 37-a to the state tax law to create a tax credit for agricultural ingredients needed for beer production equal to the costs necessary for the production of such ingredients, to provide the crop is sold directly to a distributor registered, and to provide no credit shall be allowed for any ingredient used to add flavor, color, or alter characteristic of the beer.

Section 2: amends section 210-B of the tax law by adding subdivision 51 to provide for the tax credit imposed in Section 1 to be counted against the tax imposed, including the ability for a provider to receive a refund or overpayment credit should the amount of the production credit exceed the overall tax liability.

Section 3: amends subparagraph B of paragraph 1 of subsection I of section 606 of the state tax law by adding clause xliii to provide for the beer production tax credit for shareholders of a New York S corporation.

Section 4: amends section 606 of the tax law by adding subsection eee to provide for the beer production ingredients tax credit.

Section 5: sets the effective date.

Justification

Between 2012 and 2014, the New York State Brewers Association has reported that the number of New York State breweries has risen from 95 to 207. Many of these New York brewers look to locally sourced ingredients for their brews. This increase provides for a unique opportunity for New York agricultural producers to provide locally grown materials to these breweries, without the added cost of shipping agricultural ingredients over a long distance. This tax credit would only apply to the underlying cost of growing ingredients for brewing, and would not apply to any profits earned when selling the ingredients to the breweries.

Implementing an agricultural production tax credit for New York growers will allow these producers to recoup the cost incurred in growing these products. By providing such a credit, New York farmers could better compete with agricultural producers in other states and in other countries. New York could see an increase in the number of farms and ingredients produced, which would lead to an increase in jobs at these farms within the state. Additionally, New York brewers would be able to purchase more cost effective, locally grown ingredients, which would give local breweries a more economical source of local ingredients.

Legislative history

New Bill.

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately.