As Congress addressed the most comprehensive business and individual tax overhaul since 1986, America’s 3,300 independent beer distributors worked to ensure:
NBWA supported comprehensive tax reform and encouraged Congress to lower the individual and corporate tax rates in similar ways. H.R. 116, introduced by Rep. Vern Buchanan (FL), and S. 707, introduced by Sens. Susan Collins (ME) and Bill Nelson (FL), provided tax parity so that Main Street businesses would not be taxed at a higher rate than large corporations.
There are more than 4.5 million S corporations in the United States, employing one in four private-sector workers. NBWA member companies are largely structured as S corporations, and their business income flows through to the owner’s individual income tax return. NBWA asked Congress to support tax reform that treats S corporations and large corporations equitably, allowing beer distributors and other American businesses to support growth for jobs and the economy.
NBWA asked Congress to support the S Corporation Modernization Act, H.R. 1696, introduced by Reps. Dave Reichert (WA) and Ron Kind (WI), and S. 711, introduced by Sens. John Thune (SD) and Ben Cardin (MD).
NBWA opposed the repeal of the LIFO method of accounting for inventory. More than half of NBWA distributor members use LIFO. If LIFO were repealed, beer distribution companies that utilize LIFO would be impacted disproportionately and face a significant increase in tax liability.
NBWA asked Congress to oppose efforts to repeal LIFO inventory accounting.
Estate tax relief and preserving estate planning tools, including valuation discounts and grantor-retained annuity trusts, helps beer distributors and other family-owned businesses plan and invest in the future.
Last year, the Treasury Department issued proposed regulations on Section 2704, affecting estate, gift and generation-skipping taxes for transfers of interests in family-owned entities. The proposed changes sought to eliminate discounts for minority and non-controlling shares of family businesses that are subject to the estate tax.
NBWA encouraged Congress to support the Protect Family Farms and Businesses Act, H.R. 308, introduced by Rep. Warren Davidson (OH), and S. 47, introduced by Sen. Marco Rubio (FL), to block the proposed regulation from becoming final.
NBWA believes the Craft Beverage Modernization and Tax Reform Act is a step in the right direction because it reflects current industry structure; applies to all alcohol manufacturers and importers; and recognizes distinctions among beer, wine and liquor.
The Craft Beverage Modernization and Tax Reform Act was introduced in the Senate (S. 236) by Sens. Ron Wyden (OR) and Roy Blunt (MO), and companion legislation was introduced in the House (H.R. 747) by Reps. Erik Paulsen (MN) and Ron Kind (WI). Although the legislation doesn't provide tax relief for NBWA’s distributor members, the bill is a positive development because it reflects current industry structure and applies to all brewers and importers. The legislation also provides tax relief for wine and liquor producers. In past years, NBWA did not support legislation that sought to change industry structure by creating preferential tax treatment for a few brewers. The Craft Beverage Modernization and Tax Reform Act, originally introduced in 2015, unified all interested groups around legislation to reduce federal excise taxes.