Read at Wine Enthusiast
The bipartisan Bubble Tax Modernization Act (H.R. 7029) is seeking to remove the higher tax brackets for hard cider, perry, mead, and co-fermented fruit wines with additional fruits and higher carbonation levels. These arbitrary tax brackets have been impacting the beverage industry for years, forcing producers to pay significantly more compared to standard apple- or pear-only cider. The proposed change would level the playing field by allowing these fruit-based sparkling beverages the same carbonation levels without higher tax rates.
"This tax has controlled the beverage industry for years," says Dan Rinke, co-owner of Art+Science."
The U.S. cider industry is facing increasing competition from breweries exploring fruit-flavored beers and malt beverages. The global fruit beer market is estimated to have generated $266.9 billion in 2022 and is expected to reach $379.5 billion in 2028. Unlike cider, beer, and malt beverages are not subject to the higher tax brackets. The proposed change in the tax law could provide a much-needed boost for the cider industry to remain competitive and continue to grow.
The proposed change comes at a critical time for the U.S. cider industry, which is facing increasing pressure from breweries that are exploring fruit-flavored beers and malt beverages.