You might not know it, but about half the cost of your preferred alcoholic beverage is made up of taxes and fees. One man in Congress, Rep. Todd Young (R-Ind.) wants to change that. Today he introduced a bill that would introduced a bill that would cut the current federal excise tax rate on whiskey, rum, vodka, and gin. For the first 100,000 gallons, the bill would reduce the tax from from $13.50 per proof gallon to $2.70 per proof gallon, and for subsequent gallons the tax would be $9 per proof gallon.
H.R. 2520 has support from both the American Craft Spirits Association (ACSA) and the Distilled Spirits Council of the U.S. (DISCUS), which said in their press releasethat “[d]istilled spirits products are one of the most highly taxed consumer products in the United States.” According to ACSA President Tom Mooney, the bill “will help create jobs across America for the rapidly growing distilling industry. It will translate into real economic benefits and jobs for hundreds of small distillers and their surrounding communities.”
How much will you save if Congress enacts Young’s bill? DISCUS crunched the numbers and noted that about 15 percent of the cost of a typical 750 ml bottle of 80-proof spirits is made up of the federal excise tax. So, if the bottle costs $14.42 about $2.14 goes toward the federal excise tax. It’s not much, but it doesn’t hurt. We’d like to see the federal excise tax eliminated on all alcoholic beverages, but this seems like a good first step.
This article originally appeared on the Competitive Enterprise Institute’s OpenMarket.
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