Success for CBMA and COVID Relief

After reporting success last week and then reporting the President’s refusal to sign the omnibus spending bill, we can now announce that the President has signed the “Consolidated Appropriations Act 2021” as approved by Congress. The bill is over 5000 pages long and includes the COVID Relief bill, funds the government, and enacts permanency for the Craft Beverage Modernization Act. 

Thus, for the beverage alcohol industry, this is great news for all involved. As reported previously, there are changes in the language of the law that will have an impact, primarily on importers. For importers, nothing changes in the immediate term and all provisions currently in place are planned to continue until January 1, 2023. The language of the law included both the provisions for benefits based on allocation from foreign producers as well as the continuation of the lower tax rate for wine between 14 and 16% ABV. As of January 1, 2021, the Treasury Department is authorized to collect information from foreign producers as needed to verify CBMA eligibility. 

In the next six months, the legislation requires that the Department of Treasury, in coordination with CBP/Department of Homeland Security, prepare a report as to the implementation and new process for administering CBMA post December 31, 2022. WSSA and other key industry associations expect to be actively involved in providing input to the future process, and we look forward to working with all of our members for public input. As previously reported, the legislation to make CBMA permanent also requires a change in authority as of January 1, 2023, from CBP/US Customs to the Treasury Department, but does not specify which arm of Treasury will be in charge of the process. Our assumption would be either TTB or IRS, and we will keep you fully advised as this develops.

Overall, great news for everyone to get this Act signed and move forward into the New Year with better times to come. We thank all of you for the support you give to WSSA and wish you all a safe, healthy, and happy 2021.