The Issue: In 2020, Congress reinforced the longstanding principle that beer, wine and liquor should be taxed differently. These lines of distinction follow consensus public health and policy principles regarding alcohol. Some liquor manufacturers are now attempting to blur the lines by:

• Proposing a lower tax rate for liquor-based beverages sold in a can.
• Seeking to expand the substitution drawback of excise taxes paid on imported alcohol.

We Encourage Congress To:

Maintain federal alcohol tax policy that reflects the differences between alcohol beverage products.

Oppose the Duty Drawback Clarification Act, which has been introduced in previous Congresses.
It would allow certain liquor producers to further lower their effective tax rate by expanding the substitution drawback program on imports.