Lexington, KY – Congressman Andy Barr (KY-06) was instrumental in securing a major victory for Kentucky’s bourbon industry in the form of the Craft Beverage Modernization and Tax Reform Act (CBMTRA), which includes the Aged Distilled Spirits Act championed by Congressman Barr.
As a provision within the CBMTRA, Congressman Barr’s Aged Distilled Spirits Act creates a level playing field for bourbon distillers, allowing them to deduct interest expenses associated with production in the year it is paid, not when the bourbon is bottled and sold. This legislation also lowers the Federal Excise Tax (FET) rates for distillers and aged spirits. These FET rates were set to expire on December 31 unless Congress acted to make them permanent or provide an extension.
“Throughout my time in Congress, I have made the creation of a level playing field for our bourbon distillers a priority,” said Congressman Barr. “Bourbon is one of our Commonwealth’s most well-known industries and America’s only official native spirit, a lower excise tax allows distillers to invest in their products, create more jobs and creates a better economic environment across central Kentucky.”
The passage of the Craft Beverage Modernization Act was monumental for our distillery in Lexington and for all craft distillers across the nation,” said Amir Peay, Owner of Old Pepper Distillery in Lexington. “As an independent whiskey producer it gave us federal excise tax parity with beer and wine, which resulted in a substantial reduction in our costs, and created savings that we are able to reinvest into our business, community and employees. This historic occasion was the result of years of hard work across our industry and with unprecedented bipartisan support in Congress. Congressman Barr was a key supporter throughout the process. His door was always open to hear our concerns and offer ideas to get the bill across the finish line. We are extremely grateful to him for his pivotal role in the legislation and for his unwavering support for Kentucky Bourbon.
“We thank Congressman Barr for his on-going support in helping pass the legislation making the CBMA (Craft Beverage Modernization Act) permanent,” said Max Shapira, CEO and Owner of Heaven Hill Distilleries. “This Congressional action enhances the growing platform of the entire Bourbon industry, setting the stage for continued expansion, both domestically and internationally, in the years to come.”
This legislation had backing from several major beverage alcohol associations, including The Kentucky Distillers’ Association and The Brewer’s Association. Not only does the CBMTRA lower the excise tax on distilled spirits, but the legislation also applies to beer and wine producers. By enacting the CBMTRA before the expiration date, distillers across the Sixth District avoided an excise tax increase of up to 400% for the next year.
Congressman Barr signed onto two separate letters during the 116th Congress sharing his support for the passage of the CBMTRA.
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