What's happening
This bill revises and specifies the per-gallon tax credits for various types of alcoholic beverages produced in New York State.
Why it matters
Creates specific, separate tax credit rates for different alcoholic beverage categories. (beer, cider, wine, and several types of liquor), rather than applying a single rate to all types.
May encourage the growth of small and craft producers. by more precisely targeting credits, potentially making some beverages more economically attractive to produce in-state.
Aims to clarify and modernize the tax code. by defining beverage types and alcohol content thresholds, which could reduce ambiguity and administrative confusion for both producers and tax authorities.
Could shift the competitiveness and profitability among beverage types. (e.g., cider vs. beer, low- vs. high-alcohol liquors), influencing what producers choose to make in New York State.
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Who cares
Headline styles
Increase Alcohol Production Credit
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Referred to investigations and government operations
- Referred to investigations and government operations
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
246
2019-2020 Regular Sessions
IN SENATE (Prefiled)
January 9, 2019
Introduced by Sen. KENNEDY -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
AN ACT to amend the tax law, in relation to the amount of credit for cider, wine, and liquor under the alcoholic beverage production credit
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Paragraph 1 of subdivision (b) of section 37 of the tax law, as amended by section 1 of part V of chapter 60 of the laws of 2016, is amended to read as follows:
(1) for the first five hundred thousand gallons of:
i. beer[, cider, wine or liquor] produced in this state in the taxable year, the credit shall equal fourteen cents per gallon; [and]
ii. cider, artificially carbonated sparkling cider, and natural sparkling cider, containing more than three and two-tenths per centum of alcohol by volume produced in this state in the taxable year, the credit shall equal three and seventy-nine hundredths cents per gallon;
iii. still wine, artificially carbonated sparkling wine, and natural sparkling wine produced in this state in the taxable year, the credit shall equal thirty cents per gallon;
iv. liquors containing not more than twenty-four per centum of alcohol by volume produced in this state in the taxable year, the credit shall equal two and fifty-four hundredths cents per gallon;
v. liquors containing not more than two per centum of alcohol by volume produced in this state in the taxable year, the credit shall equal four cents per gallon;
vi. all other liquors produced in this state in the taxable year, the credit shall equal six and forty-four hundredths cents per gallon; and
§ 2. This act shall take effect immediately and shall apply to taxable years beginning on or after January 1, 2020.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05760-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the tax law, in relation to the amount of credit for cider, wine, and liquor under the alcoholic beverage production credit
Summary of specific provisions
Section 1. Maintains the credit amount for:
For the first 500,000 gallons of:
i. beer produced in this state in the taxable year, the credit shall equal 14 cents per gallon. Updates the credit amount for the following: For the first 500,000 gallons of:
ii. Cider, artificially carbonated sparkling cider, and natural sparkl- ing cider, containing more than three and two-tenths per centum of alco- hol by volume produced in this state in the taxable year, the credit shall equal 3.79 cents per gallon;
iii. Still wine, artificially carbonated sparkling wine, and natural sparkling wine produced in this state in the taxable year, the credit shall equal 0.30 cents per gallon;
iv. Liquors containing not more than 24% of alcohol by volume produced in this state in the taxable year, the credit shall equal 2.54 cents per gallon;
v. Liquors containing not more than 2% of alcohol by volume produced in this state in the taxable year, the credit shall equal 0.04 cents per gallon;
vi. All other liquors produced in this state in the taxable year, the credit shall equal 6.44 cents per gallon.
Justification
In 2016, the Alcoholic Beverage Production Tax Credit was extended to include cider, wine, and spirits. By extending the current beer credit (14 cents) to all industries, an inequity occurred resulting in differ- ent tax credit amounts being given to the different distillers. When extending the credit, the precise tax paid by spirit distillers was not considered nor was there any adjustment made to reflect an equal credit distribution across industries.
Due to this, the 14 cents a gallon credit is 100% of the taxes for beer but only accounts for about 2% of the tax for Spirits. This inequity leaves small businesses at an unfair disadvantage. The bill would amend the credit to create equity and parity among the different beverage industries. New York state has experienced a surge in the distilling industry - going from 11 distillers in 2011 to 148 in 2017. This increase in the Spirits industry has not been accounted for in the current credit they receive.
Legislative history
2017-18: S.7396/A.8996
Fiscal implications
TBD
Effective date
This act shall take effect immediately and shall apply to taxable years beginning on or after January 1, 2020.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.