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U.S. Treasury, CBP interim final rule; alcohol excise tax refunds

U.S. Treasury, CBP; alcohol excise tax refunds

The U.S. Treasury Department and U.S. Customs and Border Protection (CBP) today jointly issued an interim final rule for publication in the Federal Register announcing that CBP regulations will be updated to reflect the current organization of the Treasury Department and CBP for purposes of eliminating a restriction pertaining to CBP’s authority to refund excessive duties, taxes, fees, or interest imposed on distilled spirits, wine, and beer.

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These changes are intended to facilitate implementation of provisions of the new tax law (Pub. L. No. 115-97, enacted December 22, 2017)—that is, the provisions that are referred to as the “Craft Beverage Modernization Act.” 

As noted in the interim final rule [PDF 222 KB], the new law amended the Internal Revenue Code for two calendar years with respect to the tax treatment of alcoholic beverages, including beer, wine, and distilled spirits. For an importer to be eligible to receive a reduced tax rate or a tax credit, the importer must be able to substantiate that the foreign producer has assigned an allotment of its reduced tax rate or tax credits to the beer, wine, or distilled spirits imported by that importer. The new CBP regulations clarify that CBP has authority to refund the difference between the full excise taxes an importer pays at the time of entry summary filing and the new tax law’s lower effective tax rate. An importer must request and substantiate its entitlement to the reduced tax rate or tax credit appropriately.

The interim final rule is effective on August 16, 2018—the date when it will be published in the Federal Register. Comments are due 60 days after August 16, 2018.

 

For more information, contact a tax professional with KPMG’s Excise Tax Practice group:

Deborah Gordon | +1 (202) 533 5965 | dkgordon@kpmg.com

Taylor Cortright | +1 (202) 533 6188 | tcortright@kpmg.com

Or contact a professional with KPMG’s Trade & Customs Services:

Doug Zuvich
Partner, Global Practice Leader
T: 312-665-1022
E: dzuvich@kpmg.com

Andy Siciliano
Partner, National Practice Leader
T: 631-425-6057
E: asiciliano@kpmg.com

Irina Vaysfeld
Principal
T: 212-872-2973
E: ivaysfeld@kpmg.com

Robert Waldrop
Principal
T: 212-954-8117 
E: rwaldrop@kpmg.com

Christopher Young
Principal
T: 312-665-3229
E: christopheryoung@kpmg.com

George Zaharatos
Principal
T: 404-222-3292
E: gzaharatos@kpmg.com

John L. McLoughlin
Principal, East Coast Leader
T: 267-256-2614
E: jlmcloughlin@kpmg.com

Luis (Lou) Abad
Principal, WNT
T: 212-954-3094
E: labad@kpmg.com

Amie Ahanchian
Managing Director
T: 202-533-3247
E: aahanchian@kpmg.com

Gisele Belotto
Managing Director
T: 305-913-2779
E: gbelotto@kpmg.com

Andy Doornaert
Managing Director
T: 313-230-3080
E: adoornaert@kpmg.com

Jessica Libby
Managing Director
T: 612-305-5533
E: jlibby@kpmg.com

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