Legislation proposed to revamp cider definition, avoid increased taxes

The craft brewing industry has won its fair share of legislative battles this year. That positive sentiment from the country’s lawmakers and regulators might be turning in favor of the cider industry as well.

The United States Association of Cider Makers (USACM), the national trade association of the cider industry, released the following statement after U.S. Reps. Earl Blumenauer (D-OR) and Chris Collins (R-NY) teamed up to introduce the bipartisan “Cider Industry Deserves Equal Regulation Act,” or CIDER Act (H.R. 2921):

“We are extremely excited to be working with Congressmen Blumenauer and Collins on this very important legislation for our industry, and are deeply appreciative of their leadership on this matter,” said Mike Beck, president of the USACM.  “Reps. Blumenauer and Collins deserve great credit for recognizing that America’s cider industry is primed for continued strong growth, and that we can increase our competitiveness in international markets and create jobs here in the United States if this legislation is enacted.”

The Blumenauer-Collins bill would amend the section of the Internal Revenue Code (26 USC Section 5041) to allow cider makers to produce hard cider using the natural products available without the possibility of facing increased tax liability.  Specifically, the legislation would:

(1) Increase the carbonation level for hard cider, thereby meeting customer expectations,
(2) Include pears in the definition of “hard cider,” and
(3) Align the alcohol-content standard for hard cider with the natural sugar content of apples.

Under current federal law, for example, the outdated definition of hard cider allows for up to 7 percent alcohol by volume before it is taxed as a wine, and only a certain level of carbonation before it is subject to the champagne tax.  The legislative changes made by H.R. 2921 would ensure that ciders are taxed consistently.

“This legislation really is about updating the tax law to reflect the realities in today’s cider marketplace,” Beck said. “We are going to work hard with Reps. Blumenauer and Collins to educate other Members about this legislation and our industry’s needs so that we can increase our competitiveness, grow our industry and create more jobs. We are hopeful that a Senate companion bill will be introduced soon, and that this legislative change will be made part of any tax legislation that is considered by the Congress.”

The USACM is an organization of cider and perry producers in the United States. It gathers and shares information about cider production, cider regulations, and cider apple growing, to help members improve their operations, raise awareness and advance cider in the market.