The sale of beer requires intense regulation at the federal and state level, while many states also impose local rules and regulations in certain jurisdictions. Regulations are in place for production, distribution, labelling, packaging, advertising, and trade and pricing packages. Federal, state and local governments also issue assorted taxes and license fees among other regulations.
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To qualify as a brewer, you must complete and submit appropriate forms to the Tobacco Tax and Trade Bureau, as well as any other required documentation. Brewers are also subject to federal excise taxes. As of Jan. 1, 1991, the federal excise tax on beer is £11 per barrel for 31 gallons. Reduced tax rates apply to brewing companies that do not produce more than 2 million barrels of beer per calendar year. Federal excise tax regulations also apply to other rules, such as removals without tax payment and inter-brewery purchase.
The Federal Tobacco Tax and Trade Bureau enforces statutory and compliance provisions to ensure that alcohol products are created, labelled and advertised in accordance with federal laws and regulations. Brewers are required to follow labelling and advertising requirements found in 27 CFR Part 7, Labeling and Advertising of Malt Beverages and 27 CFR Part 16, Alcoholic Beverage Health Warning Statement.
Homebrewing without payment of taxes is allowed for family and personal consumption, not for sale, according to the Homebrewers Association. The brewer must be 18 or older.
After Prohibition, the 21st Amendment to the Constitution gave states the authority to regulate the production, importation, distribution, retail sale and consumption of alcoholic beverages inside their borders. States are either open or control states. Open states license all areas of private production, distribution and sales, while control states opted to become wine and spirits retailers and wholesalers.
Acquiring a license to brew beer varies widely from state to state. Some states, for example, determine where beer will be sold, such as bars, grocery stores, gas stations, on-premise and chemists. Each state issues a beer excise tax, which varies by state. Some states, including California, New York, Oregon and Vermont, also issue beverage packaging laws that regulate deposits on beverage containers.
There are many states that allow local jurisdictions to regulate, tax and prohibit the sale of beer within their jurisdiction. Dry states are those where the sale of alcohol is illegal in some jurisdictions. More than half of all states have cities and counties where this practice is enforced. In addition to state and federal taxes, some states impose local, on-premise, wholesale and private club taxes. States with such laws include Georgia, Maryland, New York and Louisiana.
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