Why Advocacy Matters
In Washington, D.C., and state capitols across the nation, politicians are writing and enacting laws that can have a profound impact on spirits business and on the everyday lives of spirits consumers. It is up to us to make sure lawmakers are educated on how their actions will help or harm both the producers of great spirits and the consumers who enjoy them. Advocacy is a team effort, so we need your engagement with Spirits United. Your voice is a critical asset in shaping the issues that impact our industry and consumers.
Distilled spirits are enjoyed by millions of adult consumers responsibly every day. Collectively, we are joined together to support this great industry and promote the enjoyment of distilled spirits responsibly.
Market Modernization in the States
When the prohibition of alcohol in the United States ended in 1933, states and localities were given the power to regulate the sale and distribution of alcohol, pursuant to the 21st Amendment. However, many states still have ill-conceived and outdated laws to limit the consumer access to the spirits marketplace across the U.S.
We fully support proper regulations to ensure beverage alcohol is only consumed by those of legal drinking age.
Today, 43 states allow the sale of distilled spirits on Sundays. However, 7 states (Alabama, Mississippi, Montana, North Carolina, South Carolina, Texas, Utah) completely prohibit the sale of spirits on Sunday. These laws are called “blue laws” and are antiquated restrictions intended to limit convenient consumer access to spirits based on old-fashioned ideals. The government shouldn’t be in the businesses of telling consumers when they can purchase their favorite products. Our goal is to enable consumers to be able to make their own choices about their purchases and put an end to the outdated ban on seven-day spirits sales.
The distilled spirits industry produces thousands of different brands and continues to develop new products every year. A consumer can easily be overwhelmed by the number of quality products available for purchase. Just as tasting a small sample of food before you buy it can help you make a decision on whether or not to buy that product, spirits tastings can be an incredibly effective way for consumers to make an informed and personal decision on how to spend their hard-earned money.
Currently, 46 states allow some form of distilled spirits tastings, with 37 states allowing tastings both at on-premise and off-premise establishments. These states have regulations in place to limit the size and number of tastings (i.e. no more than three ¼ ounce samples per person per day), as well as prohibit illegal, underage consumption. Of course, regulations allowing for legal drinking age consumer tastings need to uphold high standards of responsibility. However, tastings should be allowed in any retail establishment where beverage alcohol is sold that allows adults to try different brands or products.
Furthermore, many states allow wine and beer tastings, but not for spirits. This contributes to an uneven marketplace. After all, alcohol is alcohol and spirits, beer and wine products should be treated the same.
Alaska, North Carolina, and Utah have a complete ban on spirits tastings, making it harder for the consumer to decide which brand or product they want to purchase.
Our goal is to enable both on-premise and off-premise establishments to provide distilled spirits tastings to consumers so that they can make an informed and personal decision on which spirits they might want to purchase.
At the federal, state, and local levels, burdensome taxes are applied to spirits that are not required of other industries or consumer products. With all of these taxes and fees, nearly 50 percent of the retail price of a typical bottle of distilled spirits goes toward a tax or fee of some kind in most states.
This cost is passed onto the consumer and further limits open market access for responsible adult consumers who want to enjoy their favorite cocktail. There is no evidence an increase on taxes deters those who abuse alcohol. High taxes on distilled spirits are a significant burden on distilled spirits consumers, thereby impacting the local economy and jobs. Often, consumers in high-tax states may choose to take their business across state lines.
Trade & Tariffs
Free trade and access to international markets are critically important for the growth of the U.S. distilled spirits industry. However, tariffs restrict free trade and result in serious consequences for our industry.
Since June 2018, the EU and UK have imposed 25% retaliatory tariffs on American Whiskeys in response to U.S. steel and aluminum tariffs. Due to the tariffs on American Whiskeys, the value of American Whiskey exports to the UK and EU have decreased by 53% and 37%. In December 2021, the EU’s tariff on American Whiskey will automatically increase to 50%. Unfortunately, American Whiskeys remain the only spirit subject to tariffs in the transatlantic trade disputes.
In June 2021, the U.S. reached agreements with the EU and UK to suspend tariffs for five years in the WTO Boeing-Airbus disputes on U.S. rum, and on Single Malt Scotch, Single Malt Irish Whisky from Northern Ireland, liqueurs and cordials from Germany, Ireland, Italy UK, and Spain, and on certain Cognacs and other grape brandies from France and Germany. This was a welcome and important development in the return to tariff-free trade in distilled spirits.
Tariffs have a damaging ripple effect throughout the entire industry harming distillery workers, importers, exporters, distributors, retail and restaurant workers, farmers, packaging companies and logistic providers. The added pressure resulting from these tariffs compound the negative impact on businesses and workers impacted by the global pandemic.