What You Need To Know

DISCUS – A Resource Available to You

• A $15 million trade association
• 48 Washington-based professionals
• Lobbyist in 40 states
• Daily liaison with State and Federal regulators
• Keeper of the Code of Good Marketing Practices
• Industry leaders in responsibility
• Advocates of cultural acceptance and responsibility
• Advocates of industry heritage

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HOSPITALITY INDUSTRY URGES MICHIGAN’S SMALL BUSINESSES TO HELP STOP JOB-KILLING SPIRITS TAX INCREASES

READERS: TO SEND YOUR LETTER TO GOVERNOR JENNIFER GRANHOLM OPPOSING SENATE BILL 339, CLICK ON THE FOLLOWING LINK:

http://capwiz.com/discus/mail/compose/?id=31687&state=&azip=&bzip=&type=GV

The Distilled Spirits Council today joined the Michigan Licensed Beverage Association (MLBA) in urging thousands of Michigan small business owners to contact their legislators to voice strong opposition to a job-killing hospitality tax proposal that would increase the state’s already excessive spirits tax by 10 percentage points.

The growing coalition of hospitality organizations is working together to generate a wave of grassroots outrage at Governor Jennifer Granholm’s misguided and ill-conceived tax proposal, Senate Bill 339.

“We are reaching out to thousands of small business owners across Michigan who will suffer the most harm by the bill and urging them to contact their legislators to voice their strong opposition,” said Cathy Pavick, MLBA Executive Director. “This is just the first wave of a larger effort to urge legislators to protect the industry they’re so heavily reliant upon to boost state hospitality and tourism revenues.”

The bill, introduced by Senator Michael Switalski, would increase the state mark-up on spirits from 65 percent to 75 percent, a move that would cost Michigan 1,800 hospitality sector jobs, according to an economic analysis by the Distilled Spirits Council.

“We strongly support the MLBA’s efforts to focus legislators’ attention on the devastating effect hospitality tax increases have on small businesses,” said David Wojnar, Vice President of the Distilled Spirits Council. “A tax on spirits such as the Governor has proposed will hurt everyone in the industry – from bartenders to busboys.”

According to the Council’s analysis, Michigan already has the highest spirits tax rate in the region and the sixth highest spirits tax rate in the United States. Michigan’s spirits tax quadruples that of Indiana and more than triples Wisconsin’s rate.

Wojnar noted that half the price of a typical bottle of spirits in Michigan already goes to taxes and fees.

“If Michigan raises its tax even higher, consumers will cross the border to shop and dine, which will end up draining Michigan’s tax revenues even more,” he said.

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CONGRESS REPEALS SOT FEE

Last summer Congress enacted a permanent repeal of the Special Occupancy Tax paid by retailers, wholesalers and suppliers. Effective July 1, 2006 retailers who sell on or off premise will no longer be required to remit the annual $250 fee to the Alcohol and Tobacco Tax and Trade Bureau (TTB). However, retailers, wholesalers and suppliers will still be required to file annual records, including the name and address where business is being conducted.

For more information about the SOT repeal, contact the Public Information Officer at 1-800-937-8864 or 513-684-2979.

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Alcohol Permits
Federal Alcohol Administration Permits

Every person who produces, processes or warehouses distilled spirits or wine shall obtain a basic permit. Anyone engaged in the business of purchasing for resale at wholesale or importing distilled spirits, wine, or malt beverages must also first obtain a basic permit. All such persons before commencing business must file an application and necessary documents with TTB. The applicant must have a permit approved by TTB in hand before engaging in business. For specific information and copies of forms see: Who To Contact and Where to File

Retail Sales

Questions on opening a bar, restaurant or carry out selling beverage alcohol products, or information on Special Taxes (Tax stamp) and other Federal Requirements for retail sales: ttbtaxstamp@ttb.treas.gov (please contact your State for license information)

Liquor Laws & Regulations for Retail Dealers

This publication will explain the principal Federal liquor laws and regulations that affect you. Its purpose is to help you conduct your business in compliance with the law and regulations.

http://www.ttb.gov/publications/alctob_pub/5170-2a.htm

The table of contents listed below will direct you to particular questions you may have.

Contents

1. General
2. Tax on Retail Dealers
3. No Tax on Limited Retail Dealers
4. Stamp not a License
5. Time for Payment of Special Tax
6. Retail Dealers Conducting Business at More Than One Location
7. Employer Identification Number
8. Computation of Tax
9. Tax Not Refundable
10. Special Tax Stamp to be Kept Available for Examination
11. Change in Location of Business
12. Change in Ownership or Control of Business
13. Requirements on Retail Dealers Who Sell to Other Dealers
14. Sales in Quantities of 20 Wine Gallons
15. Liability of Additional Taxes for "Peddling"
16. Closure on Bottles of Distilled Spirits
17. Refilling, Reusing and Disposing of Liquor Bottles
18. Prohibited Purchases of Distilled Spirits
19. Required Records
20. Inspection by Alcohol, Tobacco and Firearms Officers
21. Obtaining TTB Form 5630.5, Annual Special Tax Registration and Return

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TELL US ABOUT YOUR LEGISLATIVE ACCOMPLISHMENTS

If your state association has been successful in initiating legislation beneficial to the hospitality industry let us know. We will be happy to share the news on BevRetailSpotlight.com. Send an email with details to bevretail@discus.org and include your contact information.

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