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Tax Exemption Could Spur More Wine, Beer and Cider Tastings

By Jeff Mays | February 11, 2015 2:44pm
 There may be more wine, spirit, beer and hard cider tastings around the city following a budget proposal by Gov. Andrew Cuomo that would eliminate the "tasting tax."
Bronx Brewery
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THE BRONX — There may be more wine, spirit, beer and hard cider tastings around the city following a budget proposal by Gov. Andrew Cuomo that would eliminate the "tasting tax."

The proposal in the upcoming budget would eliminate what is known as the "use tax" for products wineries, distilleries, cideries and breweries produce for sale but serve at tastings.

The wine industry is currently covered by a tax exemption on wine they serve at tastings on their own premises. Bottles, corks, labels and caps are not excluded from the tax.

The tax exemption would extend to both off- and on-site tastings.

“By expanding tax exemptions for wine, beer, spirits and cider industries, we’re helping local producers thrive and creating an environment that encourages their success," Cuomo said in a statement. "This proposal is a smart investment in some of our most rapidly growing small businesses."

Bill Crowley, a spokesman for the New York State Liquor Authority, said the governor's proposal "levels the playing field" for the growing group of New York beer, wine, spirits and cider producers.

Since Cuomo's first Beer, Wine and Sprits Summit in Oct. 2012, the number of farm breweries, cideries, wineries and distilleries has increased 121 percent to more than 800. The industry has added 1,600 jobs in New York since 2011.

The industry has also been helped along by the Craft New York Act which simplified the rules regarding the production and marketing of craft beverages. Cuomo signed the act into law in November. The state also spent $6 million to market the beverage industry.

State officials did not disclose how much revenue they collected from the tasting tax under current rules but described its elimination as having a "minimal impact" on the state budget.

Now that her company won't have to pay tax on the cider they use in tastings, Nine Pin Ciderworks in downtown Albany is thinking of expanding further into the New York City market.

"Right now we only have our pinky toe in New York City," said Nine Pin Ciderworks co-owner Sonya del Peral.

"This means we can go out and promote our cider without having to worrying about paying a tax," she added.

Chris Gallant, co-owner of The Bronx Brewery on E. 136th Street in Port Morris, said the timing couldn't have been better.

"We opened a tasting room in October and we are selling a lot of beer through there. A lot of people are coming through the doors to try our product," said Gallant.

The company, which focuses mainly on pale ales, returned brewing to The Bronx for the first time in 50 years in 2013 when it took over an old ironworks building.

Because the company does many tastings both on and off-site using a lot of their product, Gallant expects to see some financial impact from the tasting tax exemption.

"This just gives us money to reinvest in the business," he said.