About the author

Paul Feldman is a FairWarning staff writer.

4 comments to “Tax Break for High-Alcohol Wine Sours Health Advocates”

  1. jim

    Chris, your criticism is very clever, but completely vacuous. The fact that the 14% threshold was developed “decades ago” is irrelevant. It keeps the alcohol content in over 90% of wine below 14%. When, where, and why it was developed doesn’t matter in the least.

    You bring up a great example though with Barefoot Chardonnay. Its owned by Gallo. In 2005 Gallo filed a request that the TTB (BATF) allow them to do less paperwork when they reduce the alcohol in their wine:
    https://www.ttb.gov/nprm_comments/ttbnotice17/017td0004.rtf

    So, yeah, Barefoot Chardonnay is a great example. Good point.

  2. Chris

    This is a very biased article. The 14% alcohol tax rate is an arbitrary number that was developed decades ago. Many wines currently are above this number already. While there is a tax implication, most wineries use the de-alcoholization technology to balance their wines, not to avoid taxes. For example, it is highly doubtful that Barefoot Chardonnay, the most popular wine in the United States, would raise its current alcohol rate from 13% to 14.1% because that would significantly change its taste in a way that many loyal customers would not appreciate.

    Additionally, every wine is required by law to have alcohol content by volume on the label. Customers can take that into account when purchasing or drinking the wine.

  3. Barry Clark

    The article talks about how the bill, if passed, would spur the production of higher-alcohol wines and increase alcohol (ethanol) consumption. I think another part of the bill is even more problematic. The bill would cut taxes by 80% on small and medium distilleries.

    Taxes aside, the cheapest alcohol “fixes” are some vodka and gin products. For a given amount of alcohol (ethanol), they are cheaper than beer. Small liquor producers often buy almost pure alcohol from a large agricultural producer, such as Archer Daniels Midland, and dilute it with water. For gin, they also flavor it, and may further distill it. They brag endlessly about the quality of the water they add, but the artisanal part is the marketing.

    The hard liquor excise tax is on the alcohol content. It is a larger percentage of the price of cheap booze. Small and medium producers will maximize the competitive advantage the tax cut gives them. They will flood the market with cheap vodka and gin, made cheaper by the tax cut. Hard liquor is price elastic; lower prices increase the amount that people buy. In other words, more alcohol consumption and the problems that come with it.

  4. Barry Clark

    Wyden’s press release referred to “our state’s world-renowned craft beer, wine and spirits producers.” Every member of Congress that is sponsoring the bill (217 at last count) says the same thing about their state’s booze producers. It gets tiresome pretty quickly. But the gushing about booze producers and support for a tax cut should not be surprising considering that the industry gives $ millions in political contributions and spends $ millions on lobbying each year.

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