New Vermont law lowers tax on ready-to-drink cocktails, expands sales

“With this new law, Vermont consumers will be able to visit beer and wine retailers to get their favorite ready-to-drink cocktails, and distillers will no longer be burdened with such an excessive tax rate,” said Jay Hibbard in a release. He’s the Distilled Spirits Council of the United States senior vice president of State Government Relations.

By Brent Addleman | The Center Square

Ready-to-drink cocktails made with spirits will be more widely available and taxed at a lower rate to Vermonters next month, Gov. Phil Scott said.

The governor announced Wednesday morning that he has signed House Bill 730, which calls for lowering the excise tax on the prepared adult beverages. The new law anticipates stimulating economic growth through an update to the state’s liquor laws by making the cocktails more readily available in more stores throughout the state.

“This bill takes important steps forward to modernize our liquor laws and support economic growth,” Scott said about signing the legislation.

According to a release from the Distilled Spirits Council of the United States, the new law cuts the tax on the beverages from $7.68 per gallon to $1.10 per gallon. The new law goes into effect on July 1.

“With this new law, Vermont consumers will be able to visit beer and wine retailers to get their favorite ready-to-drink cocktails, and distillers will no longer be burdened with such an excessive tax rate,” said Jay Hibbard in a release. He’s the Distilled Spirits Council of the United States senior vice president of State Government Relations.

Hibbard went on to say that states across the nation have been looking to “create a more level playing field” with ready-to-drink products, citing Vermont now being “one of the leaders in that area.”

“Treating products with the same or similar alcohol-by-volume fairly just makes sense, and this measure increases consumer convenience while supporting local businesses,” Hibbard said.

According to the fiscal note attached to the bill, state revenues are expected to increase by $80,000 in fiscal year 2023 but would then decrease by $10,000 in fiscal year 2024. The revenue would affect the general fund, the Enterprise Fund within the Department of Liquor and Lottery, and the Education Fund.

According to DISCUS, the adult beverages are only available currently at 81 state-operated stores. Beginning July 1, the organization anticipates the drinks to be sold in more than 1,000 retail stores in Vermont.

Vermont, according to DISCUS, is following a trend other states have set by lowering taxes for lower alcohol percentage drinks. Michigan and Nebraska passed similar bills last year, and 12 more states have introduced similar legislation this year.

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