Will Robinson proposal restoring alcohol excise tax deductions clears first House committee

A bill restoring long-standing excise tax deductions for alcohol distributors cleared its first House committee stop without opposition.

The House Ways & Means Committee unanimously approved HB 1137, sponsored by Bradenton Republican Rep. Will Robinson. The bill would codify deductions for alcohol that is broken, spoiled, evaporated, expired, or otherwise rendered unsellable before reaching consumers.

Robinson told committee members that the proposal restores a practice that had been in place for roughly four decades before being invalidated last Fall on procedural grounds.

He said the rule was nullified in November after a review determined the Division of Alcoholic Beverages and Tobacco, which is part of the Department of Business and Professional Regulation (DBPR), lacked explicit statutory authority to allow the deductions, but that the finding was unrelated to the substance of the policy itself.

“House Bill 1137 codifies, in my view, a noncontroversial DBPR rule that has existed for 40 years, allowing for alcohol excise tax deductions for broken or spoiled products,” Robinson told the committee Thursday.

Without legislative action, Robinson said alcohol distributors would, for the first time in decades, be required to pay excise taxes on inventory that could not legally be sold due to breakage or spoilage. The bill also restores procedures allowing distributors to deduct taxes for “extraordinary losses,” including damage caused by natural disasters or accidents during transport.

“This includes a process for claiming deductions for extraordinary losses, such as storm damage to a distributor’s facility that results in inventory too damaged to sell,” Robinson said. 

The committee adopted a strike-all amendment without objection. Robinson said the amendment aligns the House bill with its Senate counterpart and makes only stylistic changes. The Senate bill, sponsored by Melbourne Republican Sen. Debbie Mayfield, cleared its first committee favorably on Tuesday.

“There are no substantive changes in this amendment,” Robinson said. 

With no questions or debate from committee members, the bill advanced on a unanimous vote and now heads to its second of three House committee stops with the Industries & Professional Activities Subcommittee.