today signed into law a measure that retains tax benefits for New York State’s small brewers and exempts them from annual fees imposed by the State Liquor Authority. Cuomo traveled to Utica, home of F.X .Matt Brewing Co., to sign the legislation, which also creates a Farm Brewery license that will allow craft brewers to expand their operations through opening restaurants or selling new products.”In addition to producing some of the finest beer in the world, New York’s craft breweries are creating jobs, supporting our state’s farmers and hops growers, as well as bringing in tourism dollars in local communities across New York,” Cuomo said in a statement.”“Great news,” the now-in-formation Moustache Brewing Co. on Long Island said in a Facebook posting.”This legislation will help ensure that the state’s thriving craft beer industry can continue to deliver jobs, revenue and pride for New York.,” New York State Brewers Association president David Katleski said in a statement. ” Governor Cuomo and state legislative leaders deserve a lot of credit for recognizing the contribution craft brewers make to the state’s economy and creating an environment for us to grow and flourish. Today, we toast their commitment.”
Under the new law any brewery that produces 60 million gallons or less of beer in the state will now be eligible for a refundable tax credit applied against New York State personal income and business taxes. The credit is worth 14 cents per gallon for the first 500,000 gallons produced in New York, and 4.5 cents per gallon for the next 15 million gallons.
Under a previous law, small brewers in New York received an excise tax exemption, but Shelton Brothers, a Massachusetts-based importer, challenged the legal structure of the exemption. Shelton’s challenge led to a court decision that struck down the law. With the new benefits signed into law today, every small brewer will fare at least as well as they did under the prior exemption.
In addition, breweries that produce brands of 1,500 barrels or less annually (regardless of location) now are exempt from the $150 annual brand label fee. This exemption is eligible to brewers in and outside of the state.
The new Farm Brewery license required that beer must be made primarily from locally grown farm products. Until the end of 2018, at least 20 percent of the hops and 20 percent of all other ingredients must be grown or produced in New York State. The figure rises to 60 percent on Jan. 1, 2018 and 90 percent on Jan. 1, 2024. Beer manufactured under these guidelines would be designated as “New York State labeled beer.”
Brewers holding Farm Brewery licenses will be allowed to sell New York State labeled beer, wine, and liquor at their retail outlets. In addition, Farm Wineries and Distilleries will also be now permitted to sell New York State labeled beer and liquor for off-premises consumption, and Farm Distillers will also be now permitted to sell New York State labeled beer and wine for off-premises consumption.
What’s more, Farm Breweries will be allowed to open restaurants and to conduct tastings of and serve New York State labeled beer at any restaurant, conference center, inn, bed and breakfast or hotel owned by the brewery at the same or an adjacent location. They’ll also be allowed to sell beer making supplies and equipment, foods and souvenirs.
Wineries and distilleries haven’t been left out. The new law allows Farm Breweries, Farm Wineries, and Farm Distilleries to conduct tastings of all New York State labeled beer, wine, and liquor at their premises.
The new law now exempts Farm Wineries and Distilleries as well as Farm Breweries from a costly and burdensome tax-filing requirement in which they previously were required to report sales made to restaurants, bars, and other retailers. They must, however, continue to maintain sales records to show the state Tax Department if requested.
For the full text of the governor’s press release go here.