TTB Simplifies Excise Tax Regulations for Small Breweries

News by | Dec 2014 | Issue #95

The US Alcohol and Tobacco Tax and Trade Bureau (TTB) announced it will permanently reduce the regulatory burden on breweries producing less than 7,200 barrels annually.

Under the terms of the new regulations, breweries with a tax liability of less than $50,000 will have a flat $1,000 penal sum for their brewer’s bond (a type of license and permit used to guarantee compliance with specific industry regulations). Additionally, these breweries will only need to report and pay their taxes on a quarterly basis instead of monthly.

“The Brewer’s Report of Operations is an extremely time-consuming report we’re required to fill out,” explains Daniel Kleban, co-owner of Maine Beer Company. “For a small brewer, it’s not unheard of for it to take a full day or two to fill out, which was a big burden to handle every month, especially for small operations. Dropping that to a quarterly requirement is a big time-saver.”

Breweries aren’t the only ones who will see streamlined operations from these new regulations. With close to 3,000 breweries switching from monthly to quarterly reporting, TTB workers will have substantially less paper in their own inboxes.

“The TTB, for a regulatory agency, is actually pretty small,” says Mary Jane Saunders, general counsel with the Beer Institute, a trade association based in Washington, DC. “There are more breweries now than ever before in the United States. It sounds great to say, ‘We’ll get a zillion checks for $10.50,’ but if you think about the actual paperwork burden, it’s pretty inefficient.”

These measures were originally enacted in December of 2012 as a temporary act of relief for small breweries, and were set to expire at the end of the year. They will be made permanent on Jan. 1, 2015.