Subject: Cider Digest #1689, 29 January 2012 Date: Sun, 29 Jan 2012 10:29:13 -0700 (MST) From: cider-request@talisman.com Cider Digest #1689 29 January 2012 Cider and Perry Discussion Forum Contents: Excise Tax Position ("Howard, John") RE: Excise Tax (Jay Hersh) Excise Tax Position ("Rich Anderson") Re: Excise Tax Position (Dick Dunn) Excise Tax position (Andrew Lea) NOTE: Digest appears whenever there is enough material to send one. Send ONLY articles for the digest to cider@talisman.com. Use cider-request@talisman.com for subscribe/unsubscribe/admin requests. Archives of the Digest are available at www.talisman.com/cider#Archives Digest Janitor: Dick Dunn ---------------------------------------------------------------------- Subject: Excise Tax Position From: "Howard, John" Date: Wed, 25 Jan 2012 11:41:33 -0500 Well done Steve and Mike! With domestic jobs and taxes such "juicy" issues this year, one would hope there is an elected representative out there who would champion this. Best of luck! John Howard ------------------------------ Subject: RE: Excise Tax From: Jay Hersh Date: Wed, 25 Jan 2012 12:07:54 -0500 In a subject of much interest to my wife, A similar situation exists for fermentables made from honey. The law foolishly (or perhaps intentionally owing to lobbying in the early days after prohibition) classifies things for tax purposes based on the source of fermentable sugars and not the strength of the product. This has forced meads into competition with wine and has, in general, precluded the production of much in the way of "table" strength mead despite the large historical basis (at least in Europe) of the production and consumption of such lower strength mead. I applaud any effort to try to get Congress to rationalize this system and if there is anything I can do in the way of lending a hand with historical perspective on the brewing trades or tax practices in other countries please let me know. Jay Hersh aka Dr. Beer (TM) ------------------------------ Subject: Excise Tax Position From: "Rich Anderson" Date: Thu, 26 Jan 2012 13:16:38 -0800 I like this approach having scratched my head on how to approach an agency which is primarily interested in collecting taxes. One concern I have is to do this in a way which benefits all cider producers so that large producers do not take over the conversation. This proposal appears to do this by having a generic definition for cider, but it may be too narrow for some. My hope is that the Cider Conference organizers reach out to the large producers since there seems to be some animosity in the ranks of small cider producers toward large producers. We need an united front on issues like this. In the interim I plan to spend some effort in upgrading my equipment and understanding so I can monitor the carbonation process without breaking the bank and stay within limitations of current law. Enjoy Chicago! ------------------------------ Subject: Re: Excise Tax Position From: Dick Dunn Date: Thu, 26 Jan 2012 16:26:39 -0700 Mike and Steve's position paper does a good job of tackling the two most vexing matters in US cider regulation/taxation. Nevertheless, there are some serious concerns. First, although the article compares cider taxation to beer, and although the biggest cider producers use beer-style packaging and marketing, legally cider is a wine. Any changes in cider taxation will be considered in context of wine regulations. The exorbitant tax rate at higher carbonation levels doesn't just apply to cider; it applies to all wines in the US. Can the cider community influence that rate? (Can the tail wag the dog?) The case for eliminating the strange 7% abv boundary is much better, as there is nothing comparable for beer or wine (afaik). The other big concern in the proposal is redefining cider (and perry) to remove any minimum juice content and allow arbitrary addition of sugar and/or water. It simply can't stand that way. I found it so puzzling I talked to Steve Wood about it. His view is that this part of the position is deliberately provocative, and he does expect there will be some limits, but it will be up to the "big guys" to determine what they should be. His expectation (sorry to put words in your mouth Steve!) is that the big guys don't want to see cider cheapened to where it's the drink of winos or twenty-something rowdies. They can't let that happen to their market, so they'll figure out limits that they can live with. Well...I hope Steve is right, and he might well be, but after talking to others and playing devil's advocate with myself, I see various ways it could go badly: The limits might end up -not- being imposed, or they might be way too low. The no-limit position could split off serious craft cidermakers at a time when the US cider industry needs to speak with one voice. Cheap-wine makers could lobby against changes for cider as an attack on their market. Regulators, consumer advocates, and neo- prohibitionists would all have a bone to pick. Don't get me wrong--I do want to see the "bubble tax" removed and I don't want the 7% abv boundary. That means I don't want the efforts against them to backfire. - -- Dick Dunn rcd@talisman.com Hygiene, Colorado USA ------------------------------ Subject: Excise Tax position From: Andrew Lea Date: Sat, 28 Jan 2012 16:52:37 +0000 On 25/01/2012 15:59, Steve and Mike wrote: > 3. Define `cider' and `perry' as made of 100% pome fruit, with no limits > on water content, sugar content (pre- or post- fermentation), or percentage > of concentrate. As an admitted outsider from the eastern side of the pond, maybe I'm misunderstanding this, but this reads to me as if you plan no lower limits on juice content at all and would allow any amount of fortification with sugars or syrups before fermentation and added water afterwards? Is this really what you want? We had a definition of cider like this in the UK until 2010. It led to the dumbing down of mass market ciders over many years until many of them became more accurately described as 'glucose wines' (a term coined I believe by Julian Temperley). Many of these - typically the 'white ciders' with juice contents at 10% or below - became associated with drunken teenagers and the worst features of alcohol abuse. This did no favours at all to the public image of cider. To combat this, the UK government initially proposed higher taxes on all ciders above a certain alcohol level but this would have damned the good equally with the bad. Eventually common sense prevailed and we now have, for the first time ever, a statutory lower limit on the amount of apple juice that must be used in the manufacture of cider (currently 35% juice at SG 1.033). It's not very much but it does draw a boundary and more importantly it signifies that there should be boundaries. Ciders that do not comply with this are regarded as 'made wines' and are more heavily taxed http://www.legislation.gov.uk/uksi/2010/1914/pdfs/uksiem_20101914_en.pdf I am very surprised that you should willingly wish to follow the worst aspects of the British model. It will do no favours to those fighting to revitalise and to re-establish the US craft cider tradition. Please think again! Andrew Lea nr Oxford, UK www.cider.org.uk ------------------------------ End of Cider Digest #1689 *************************