1997 Legislative Changes to the Alcoholic
Beverages Tax Affecting Wines and Ciders
This publication has been cited in IP 99(3)
PURPOSE: This Special Notice provides information about changes to the definitions of "still wine" and "sparkling wine" for purposes of the alcoholic beverages tax, and announces a new alcoholic beverages tax rate for alcoholic cider made from apples. Bold type indicates legislative changes.
EFFECTIVE DATE: The statutory changes discussed in this Special Notice apply to sales by distributors, and to the storage or use within this state of any untaxed alcoholic beverages in the possession of any person other than a distributor, occurring on or after July 1, 1997.
STATUTORY AUTHORITY: Conn. Gen. Stat. §§12-433 and 12-435, as amended by 1997 Conn. Pub. Acts 243, §§32 and 33.
DEFINITION OF "STILL WINE" CHANGED TO ADOPT FEDERAL CARBONATION STANDARD AND TO INCLUDE CIDER: Effective July 1, 1997, the definition of "still wine" in Conn. Gen. Stat. §12-433 is "any wine that contains not more than three hundred ninety-two one thousandths (0.392) of a gram of carbon dioxide per hundred milliliters of wine, and shall include any fortified wine, cider that is made from the alcoholic fermentation of the juice of apples, vermouth and any artificial or imitation wine or compound sold as 'still wine' containing not less than three and two-tenths per cent of absolute alcohol by volume."
Previously, the definition of "still wine" in Conn. Gen. Stat. §12-433 referred to "any noneffervescent wine." The adoption of the standard of not more than 0.392 of a gram of carbon dioxide per 100 milliliters of wine for still wine is consistent with the federal carbonation standard for still wine in 26 U.S.C. §5041(a). The previous definition of "still wine" also specifically excluded cider.
On or after July 1, 1997, any product meeting the definition of "wine" in Conn. Gen. Stat. §12-433 ("any alcoholic beverage obtained by the fermentation of natural sugar contents of fruits or other agricultural products containing sugar") that contains not more than 0.392 of a gram of carbon dioxide per 100 milliliters, and that contains not less than 3.2% absolute alcohol by volume, including wine coolers and cider, is properly classified as a still wine.
DEFINITION OF "SPARKLING WINE" CHANGED TO ADOPT FEDERAL CARBONATION STANDARD: Effective July 1, 1997, the definition of "sparkling wine" in Conn. Gen. Stat. §12-433is "champagne and any other effervescent wine charged with more than three hundred ninety-two one thousandths (0.392) of a gram of carbon dioxide per hundred milliliters of wine, whether artificially or as a result of secondary fermentation of the wine within the container." Any product meeting the definition of "wine" in §12-433, including alcoholic cider, that contains more than 0.392 of a gram of carbon dioxide per 100 milliliters, is properly classified as a sparkling wine.
MOST CIDER TAXED AT THE BEER RATE: Although most alcoholic cider is properly classified as still wine under the definition in Conn. Gen. Stat. §12-433, most cider will not be taxed at the still wine rate. Effective July 1, 1997, Conn. Gen. Stat. §12-435(h) provides that "cider containing not more than seven per cent of absolute alcohol shall be subject to the same rate as applies to beer." The rate of tax for beer in §12-435(a) is $6 for each barrel, $3 for each half barrel, $1.50 for each quarter barrel, and 20¢ per wine gallon or fraction thereof on quantities less than a quarter barrel.
Alcoholic cider containing more than 7% but not more than 21% absolute alcohol, and containing not more than 0.392 of a gram of carbon dioxide per 100 milliliters, will be taxed at the still wine rate of 60¢ per wine gallon. (Except if such cider is produced by a person who produces not more than 55,000 gallons of wine a year, and possesses a certificate to that effect, in which case the rate will be 15¢ per wine gallon.)
Alcoholic cider containing more than 7% absolute alcohol and containing more than 0.392 of a gram of carbon dioxide per 100 milliliters will be taxed at the sparkling wine rate of $1.50 per wine gallon.
Alcoholic cider containing more than 21% absolute alcohol, regardless of the amount of carbonation in such cider, will be taxed at the sparkling wine rate of $1.50 per wine gallon.
DISTRIBUTOR'S LICENSE REQUIRED: Any person who imports into this state and sells alcoholic beverages, including alcoholic cider, or who manufactures or processes such products within this state, is subject to Chapter 220 of the Connecticut General Statutes, including the requirement that such person obtain the distributor's license required by Conn. Gen. Stat. §12-436.
REGISTRATION WITH LIQUOR CONTROL DIVISION REQUIRED: The Connecticut Department of Consumer Protection, Division of Liquor Control, advises that anyone shipping alcoholic beverages (including alcoholic cider) into the State of Connecticut should be aware that the product must be registered with the Division of Liquor Control and shipped through a licensed out-of-state shipper to a licensed Connecticut wholesaler. Any questions about this procedure should be directed to the Connecticut Department of Consumer Protection, Division of Liquor Control at 860-566-5926.
EFFECT ON OTHER DOCUMENTS: PS 96(9), the suspension of which was announced by AN 96(9), is obsoleted. Any other written advice from the Department contrary to the information in this Special Notice regarding either the classifications of cider, wine or wine coolers or the alcoholic beverages tax rates for such products is obsoleted.
EFFECT OF THIS DOCUMENT: A Special Notice is a document that, in response to newly enacted or amended Connecticut or federal laws or in response to newly released judicial decisions, announces a new Department position, policy or practice affecting the tax liability of taxpayers.
FOR FURTHER INFORMATION: If you have questions about Connecticut taxes, please call the Department of Revenue Services during business hours, Monday through Friday:
- 860-297-5962 (Hartford calling area or from out-of-state); or
- 1-800-382-9463 (toll-free from within Connecticut)
Alcoholic Beverages Tax