Registration.
Prepare to meet your alcohol importers’ requests for 2023 tax benefit assignments.
Foreign producers of distilled spirits, wine, hard cider, and beer are required to register with the U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) to assign U.S. federal excise tax benefits to their importers. Importers will no longer receive these benefits upon entry and must request refunds directly through the TTB’s new online system. All shipments are subject to updated requirements for 2023.
Start your registration and assignment process now to assure a smooth transition for your importers.
Tax Benefits Provision for Non-U.S. Producers
The Craft Beverage Modernization Act (CBMA) reduces U.S. Federal Excise Tax Rates and Tax Credits for importers on certain shipments of TTB-regulated beverages. These tax benefits are no longer applied by U.S. Customs and Border Protection (CBP) at the time of entry. Instead, importers will need to request refunds from the TTB based on their foreign producers’ assignments.
If your TTB-regulated distillery, winery, or brewery is located outside of the U.S., your importers may request the tax benefits available under this new registration system.
Starting January 1, 2023, all foreign producers planning to assign tax benefits to importers must register with the TTB. You will need to submit company, ownership, and tax information along with your FDA Food Facility Registration (“FFR”) number to set up your Foreign Producer Profile. Once registered, you’ll receive a Foreign Producer TTB ID and can begin making tax benefit assignments. All shipments arriving on or after January 1, 2023, will only be allocated tax benefits through this system.
How Registrar Corp Can Help
Meeting U.S. TTB registration requirements can take up valuable business hours—but it doesn’t have to. A leading provider of FDA compliance assistance, Registrar Corp has supported foreign producers for over 20 years. Our team of compliance experts can help you register with TTB quickly and seamlessly so that you are prepared to meet Importer requests for tax benefit assignments throughout the year.
Frequently Asked Questions
Brewers get a reduced rate of $16 (from $18) per barrel on the first 6,000,000 barrels they send, a discount of over 11%. Wineries get a tax credit of $1 per gallon on the first 30,000 gallons, 90 cents on the next 100,000 gallons, and 53.5 cents on the third 620,000 gallons. The normal rate varies depending on the type of wine.
Hard cider producers get a tax credit of 6.2 cents on the first 30,000 gallons, 5.6 cents on the next 100,000 gallons, and 3.3 cents on the third 620,000 gallons. The normal rate is 22.6 cents per gallon. Distilleries have a reduced rate of $2.70 per gallon for the first 100,000 gallons and $13.34 per gallon for the next 22.13 million gallons. The normal rate is $13.50 per gallon.
As of January 1, 2023, U.S. Customs will no longer apply reduced U.S. federal excise taxes and tax credits when a customs entry is filed. All qualified non-U.S. producers of alcoholic beverages must register with the TTB in order to assign the tax benefits for that calendar year to their U.S. importers. U.S. importers will then need to apply for refunds based on their assigned benefits.
The TTB has launched a new online portal to manage the registration process. This new registration system allows any agent designated by the foreign producer to submit the registration, edit the registration, assign tax benefits, and add or remove users.
Registrar Corp serves as an agent to assist companies with the registration process and manage their tax benefit assignments. Foreign producers must grant Registrar Corp authorization to conduct these activities via written proof of authorization and supply it to the TTB if requested.
Registration information includes your business name, address, FDA Food Facility Registration Number (FFR), and a point of contact at the company (owner or employee). If the foreign producer has additional owners as part of a “controlled group,” any owner with 10% or more ownership must be added.
Foreign producers must register using the myTTB system. Registrar Corp will complete this process for your company and include a contact that you have designated. Registrar Corp and the company contact will be designated as “authorized users” who have the authority to receive and respond to TTB communications, including notice of contemplated revocation.
Once registered, your company contact will receive an email with your Foreign Producer TTB ID. The ID must be referenced in the customs entries which your importers intend to apply for tax benefits for. You will also receive instructions in a separate email for accessing your account at the myTTB portal.
After creating a Login.Gov account, your company contact can enter the myTTB portal with their new credentials, set up a profile, and access your foreign producer registration.
Additional authorized persons may be added as either “manager” or “user.” Managers may add or remove additional authorized persons, but users may not.
Once your registration is complete, your firm will be issued a Foreign Producer ID by the TTB. This number must be shared with your importers so they can reference it when claiming their tax refunds and credits.
Changes to registration information must be updated within 60 days. Unlike the FDA FFR, a change in ownership does not require you to cancel your registration, but any new FFR information should be submitted within the 60-day window.
Select the “Add assignments” link in the TTB portal. You will need to know your importers’ TTB basic permit numbers to start the assignment.
Select the exact tax rate or credit being assigned, the applicable calendar year, and the exact quantity to be assigned to each importer. For example, a brewer may want to assign 4 million barrels to one importer and 2 million barrels to another importer.
ONCE ASSIGNED, THE TAX BENEFIT CANNOT BE CHANGED UNLESS THE IMPORTER REJECTS IT IN THE IMPORTER PORTAL. YOU MUST BE SURE THAT THE ASSIGNMENT IS CORRECT TO AVOID DELAYS OR OTHER ISSUES.
Tax benefits are based on the calendar year. Assignments can be made starting October 1 of the year prior (e.g., assignments for 2023 could be made beginning October 1, 2022). Assignments can be made at any time during the calendar year, up until December 31st. To claim the benefit, the importer’s shipment has to have arrived in port in that calendar year.
Moving forward, your importers must also use the myTTB system to claim refunds based on the tax benefits that your company has assigned them. They’ll need your company’s Foreign Producer ID number in order to complete the claims process. This portal is still in progress and is scheduled to launch later in 2023.
With the new system, importers will be able to claim refunds on a quarterly basis. They’ll receive the difference between the full rate (paid on entry) and the amount that would have been paid if the tax liability had been calculated using the tax benefits you assigned.