The Craft Beverage Modernization Act (CBMA) provisions provide for reduced rates or tax credits for beer, wine, and distilled spirits produced in or imported into the United States.

These CBMA tax benefits are limited in quantity for each producer, including foreign producers. Foreign producers utilize these CBMA tax benefits by assigning them to U.S. importers of their products.  U.S. importers pay the Federal excise tax on imported beer, wine, and distilled spirits, and must receive an assignment of the CBMA tax benefits from the foreign producer to take advantage of the CBMA tax benefits.

Starting in 2023, the Alcohol and Tobacco Tax and Trade Bureau (TTB) will take over the CBMA tax benefits system from US Customs.

You can find more information on the TTB website: https://www.ttb.gov/alcohol/cbma-imports

Here is a link to a video with more information: https://www.youtube.com/watch?v=sAMZzFfHJOQ

Here is a link to the slides of a recent TTB webinar with more information: https://www.ttb.gov/images/pdfs/CBMA_Imports_Webinar_Dec_2022.pdf

Here is how it works for wineries.  The federal tax rate for wine sold in the United States is $1.07/gallon.  Tax credits apply to the first 750,000 wine gallons (= 2,839,050 liters = 3,785,400 bottles @ 750 ml = 315,450 cases @ 12 bottles) of that producer’s wine imported into the United States during a calendar year.

The credits are, for each foreign producer,

  • $1 per wine gallon on the first 30,000 wine gallons of wine imported;
  • 90 cents on the next 100,000 wine gallons imported;
  • 53.50 cents on the next 620,000 wine gallons imported.

$1 credit per wine gallon for the first 30,000 gallons (= 113,562 liters = 151,416 bottles @ 750 ml) equals $0.198 per 750 ml bottle.  Foreign producers may assign the CBMA tax benefits to the US importer of their products.  Best of all, Quality Brand Imports fully refunds these credits to foreign wineries.  That is up to $451,700 annually.

While the amount of the credit gets reduced after the first 30,000 gallons, the credits for the first 750,000 gallons of wine imported into the United States on an annual, per-bottle basis will always be higher than the preferred QBI import rate of $0.10/bottle (based on 750 ml/bottle).

For wineries that qualify for the preferred QBI import rate, it essentially results in a net credit per 750 ml bottle imported into the United States for up to 2,839,050 bottles imported annually.

  • Up to 113,652 liters imported into the United States: $0.198 CBMA tax credit – $0.10 QBI import fee = $0.098/bottle net credit (per 750 ml bottle)
  • 113,653 liters – 492,102 liters imported into the United States: $0.178 CBMA tax credit – $0.10 QBI import fee = $0.078/bottle net credit (per 750 ml bottle)
  • 492,103 liters – 2,839,050 liters imported into the United States: $0.105 CBMA tax credit – $0.10 QBI import fee = $0.005/bottle net credit (per 750 ml bottle)

Knowing that our import services are essentially free on top of the net credit is a nice bonus in addition to all the other benefits of working with QBI.

Besides CBMA tax credits, QBI will assist US buyers to obtain refunds for VAT taxes for purchases of German wines (as well as other countries if applicable).  We offer this free service to wineries working with us on import services.

This is our contribution to lowering the retail cost of European wines in the US market.  A bit like Cyber Monday all year long.

If you are interested to learn more, please contact us at info@qualitybrandimports.com.