Bill Text: NJ A477 | 2024-2025 | Regular Session | Introduced
Bill Title: Creates new taxable category of alcoholic beverages called flavored malt beverages, imposes separate rate of taxation on new category pursuant to alcoholic beverages tax and allocates associated revenue.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced) 2024-01-09 - Introduced, Referred to Assembly Oversight, Reform and Federal Relations Committee [A477 Detail]
Download: New_Jersey-2024-A477-Introduced.html
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblyman JOE DANIELSEN
District 17 (Middlesex and Somerset)
Assemblywoman PAMELA R. LAMPITT
District 6 (Burlington and Camden)
SYNOPSIS
Creates new taxable category of alcoholic beverages called flavored malt beverages, imposes separate rate of taxation on new category pursuant to alcoholic beverages tax and allocates associated revenue.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act creating a new taxable category of alcoholic beverages called flavored malt beverages, imposing a separate rate of taxation on flavored malt beverages pursuant to the alcoholic beverages tax and allocating the associated revenue, amending R.S.54:41-2, R.S.54:43-1 and P.L.1990, c.41.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.54:41-2 is amended to read as follows:
54:41-2. As used in this subtitle:
"Alcoholic beverages" means liquors, beer, wines and sparkling wine, as defined in this section.
"Beer" means beer, lager beer, ale, stout, porter, and all similar fermented malt beverages having an alcoholic content of one-half of one per centum (1/2 of 1%) or more by volume, but does not include flavored malt beverage.
"Bonded warehouse" means the warehouse of any licensed manufacturer or licensed wholesaler or licensed warehouseman for which the licensee has given special security to obtain certain privileges given by this subtitle.
"Bureau" means the Beverage Tax Bureau of the Division of Taxation in the State Department of the Treasury.
"Cider" means a beverage made from the alcoholic fermentation of the juice of apples, including but not limited to flavored, sparkling or carbonated cider.
"Commissioner," "State Tax Commissioner" or "Director" means the Director of the Division of Taxation in the State Department of the Treasury.
"Container" means the receptacle immediately surrounding the alcoholic beverage and not the carton, box, case, sack, bag or other covering in which such containers may be packed, placed, or transported.
"Department," "State Tax Department," or "Beverage Tax Bureau" means the Division of Taxation in the State Department of the Treasury.
"Flavored malt beverage" means a beverage having an alcoholic content of one half of one per centum (1/2 of 1%) or more by volume for which the producer is required to file a formula for approval with the United States Alcohol and Tobacco Tax and Trade Bureau pursuant to section 25.55 of title 27, Code of Federal Regulations.
"Licensed manufacturer" means any person holding a valid and unrevoked brewery, winery, distillery, or rectifier's license issued pursuant to the provisions of any relevant law of this State.
"Licensed transporter" means any person holding a valid and unrevoked license or permit to transport alcoholic beverages pursuant to the provisions of any relevant law of this State.
"Licensee" means the holder of any valid and unrevoked license or special permit issued pursuant to any relevant law of this State, pertaining to alcoholic beverages.
"Liquors" means all distilled or rectified spirits, alcohol, brandy, whisky, rum, gin and all similar distilled alcoholic beverages, including all dilutions and mixtures of one or more of the foregoing, such as liqueurs, cordials, and similar compounds, having an alcoholic content of one-half of one per centum (1/2 of 1%) or more by volume.
"Manufacturer" means any person holding a valid and unrevoked brewery, winery, distillery, supplemental limited distillery, or rectifier and blender's license, issued pursuant to the provisions of any relevant law of this State.
"Person" means a natural person, an association, a partnership or a corporation.
"Plenary retail transit licensee" means any person holding a valid and unrevoked plenary retail transit license issued pursuant to any relevant law of this State, authorizing the sale of alcoholic beverages for consumption only, on railroad trains, airplanes, and boats, while in transit in this State.
"Return" means the return of alcoholic beverages by a customer to the source from which such beverages were obtained, upon the cancellation of a sale, and shall include: (a) actual receipt of the beverages on the licensed premises of the source or in a licensed public warehouse for the account of the source; or (b) the sending of the beverages by the customer to another person upon instructions of the source; but shall not include any other disposition, such as samples, breakage, shortage, merchandising credits, or beverages dumped on the premises of the customer, except where such dumping is done under the supervision of the director or his representative.
"Sale" means and includes, in addition to its ordinary meaning, any exchange, gift, loss, theft, or other disposition. In every case where alcoholic beverages are exchanged, given, lost, stolen or otherwise disposed of, they shall be deemed to have been sold, unless, in case of loss by fire, proof is furnished to the satisfaction of the commissioner, that the alcoholic beverages have been so destroyed that they could not have been put to any use.
"Sparkling wine" means champagne and other effervescent wine charged with carbon dioxide, whether artificially or as the result of secondary fermentation of the wine within the container.
"State licensee" means any person holding a valid and unrevoked license or special permit, issued by the Director of the Division of Alcoholic Beverage Control, and who has posted a bond with the director to secure the payment of the alcoholic beverage taxes.
"Taxpayer" means a person chargeable with the payment of a tax pursuant to the provisions of this subtitle.
"Transportation licensee" means any person holding a valid and unrevoked license or special permit to transport alcoholic beverages pursuant to the provisions of any relevant law of this State.
"Treasurer" means the Treasurer of the State of New Jersey.
"Vermouth" means any compound made by the mixture of extracts from macerated aromatic flavoring materials with wines and manufactured in such manner that the product possesses the taste, aroma, and characteristics generally attributed to vermouth.
"Warehouse receipt" means a certificate or receipt given upon the storage of alcoholic beverages in a United States custom or United States internal revenue warehouse under federal bond.
"Warehouse receipts licensee" means any person holding a valid and unrevoked warehouse receipts license issued pursuant to any relevant law of this State.
"Wines" means all wines whether known as "dry wines," "sweet wines," "still wines," or "fortified wines" and any artificial or imitation wine or compound sold as wine, and any fruit juice containing one-half of one per centum (1/2 of 1%) or more of alcohol by volume, and any other beverage containing alcohol produced by the fermentation of the natural sugar content of fruits or other agricultural products containing sugar, which beverage contains one-half of one per centum (1/2 of 1%) or more of alcohol by volume, but shall not mean or include vermouth, or cider containing less than three and two-tenths per centum (3 2/10 %) of alcohol by volume.
(cf: P.L.1997, c.153, s.1)
2. R.S.54:43-1 is amended to read as follows:
54:43-1. Tax rates. There are hereby levied and imposed upon any sale of alcoholic beverages made within this State or upon any delivery of alcoholic beverages made within or into this State the following excise taxes:
a. Beer--From July 1, 1990 through June 30, 1992, at the rate of $0.10 a gallon or fraction thereof and on or after July 1, 1992, at the rate of $0.12 a gallon or fraction thereof.
b. Liquors--From July 1, 1990 through June 30, 1992, at the rate of $4.20 a gallon, on or after July 1, 1992 through July 31, 2009, at the rate of $4.40 a gallon and on or after August 1, 2009, at the rate of $5.50 a gallon.
c. (Deleted by amendment, P.L.1972, c.53.)
d. (Deleted by amendment, P.L.1972, c.53.)
e. Wines, vermouth and sparkling wines--From July 1, 1990 through June 30, 1992, at the rate of $0.50 a gallon, on or after July 1, 1992 through July 31, 2009, at the rate of $0.70 a gallon; and on or after August 1, 2009, at the rate of $0.875 a gallon, provided however, that cider containing at least three and two-tenths per centum (3 2/10 %) of alcohol by volume but not more than 7 per centum (7%) of alcohol by volume shall be taxed at the rate of $0.15 a gallon.
f. Flavored malt beverages--at the rate of $4.40 a gallon.
(cf: P.L.2009, c.71, s.1)
3. Section 2 of P.L.1990, c.41 (C.54:43-1.1) is amended to read as follows:
2. a. Beginning on July 1, 1992, there shall annually be deposited in the Alcohol Education, Rehabilitation and Enforcement Fund established pursuant to section 3 of P.L.1983, c.531 (C.26:2B-32), the sum of $11,000,000 of the tax collected annually pursuant to the "Alcoholic Beverage Tax Law," R.S.54:41-1 et seq.
Amounts deposited in the Alcohol Education, Rehabilitation and Enforcement Fund pursuant to subsection b. of this section shall not be included in calculating the total deposited pursuant to this subsection.
b. Beginning on the first day of the second month following the date of enactment of P.L. c. (C. ) (pending before the Legislature as this bill), the sum of all tax collected annually on flavored malt beverages pursuant to the "Alcoholic Beverage Tax Law," R.S.54:41-1 et seq. shall be divided in two equal halves for deposit. One half shall be deposited in the Alcohol Education, Rehabilitation and Enforcement Fund established pursuant to section 3 of P.L.1983, c.531 (C.26:2B-32). The second half shall be deposited in the General Fund. If it is impracticable to divide the sum of all tax collected annually on flavored malt beverages pursuant to the "Alcoholic Beverage Tax Law," R.S.54:41-1 et seq. in two equal halves due to the collection of an odd-numbered sum, the nominally larger half shall be deposited in the Alcohol Education, Rehabilitation and Enforcement Fund established pursuant to section 3 of P.L.1983, c.531 (C.26:2B-32).
(cf: P.L.1990, c.41, s.2)
4. This act shall take effect immediately, provided however sections 1 and 2 shall remain inoperative until the first day of the second month following the date of enactment.
STATEMENT
This bill creates a new taxable category of alcoholic beverages called flavored malt beverages, imposes a separate rate of taxation on flavored malt beverages pursuant to the alcoholic beverages tax and allocates the associated revenue evenly between the Alcohol Education, Rehabilitation and Enforcement Fund and the General Fund.
Though produced in a manner which incorporates certain aspects of beer brewing, much of the flavoring and alcohol in flavored malt beverages is derived from the addition of distilled spirits. This production process has the effect of creating an alcoholic beverage that is sufficiently beer-like to be taxed like beer, but sold as something else entirely. Alcoholic lemonades, alcoholic colas and cooler-type products are examples of such products.
This bill creates a new category of alcoholic beverages entitled flavored malt beverages for purposes of the alcoholic beverages tax. The new flavored malt beverage category is taxed at a rate of $4.40 per gallon to account for its reliance on distilled spirits during the production process. The bill also calls for the proceeds derived from this new category to be allocated evenly between the Alcohol Education, Rehabilitation and Enforcement Fund and the General Fund.
