wa-law.org > bill > 2023-24 > HB 1182 > Substitute Bill
(1) There Except as provided in (d) of this subsection, there is hereby imposed upon all wines except cider sold to wine distributors within the state a tax at the rate of twenty and one-fourth cents per liter. Any domestic winery or certificate of approval holder acting as a distributor of its own production must pay taxes imposed by this section. There Except as provided in (d) of this subsection, there is hereby imposed on all cider sold to wine distributors within the state a tax at the rate of three and fifty-nine one-hundredths cents per liter. However, wine sold or shipped in bulk from one winery to another winery is not subject to such tax.
This section is the tax preference performance statement for the tax preference contained in section 1, chapter . . ., Laws of 2023 (section 1 of this act). This performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or to be used to determine eligibility for preferential tax treatment.
The legislature categorizes this tax preference as one intended to provide tax relief to certain businesses or individuals.
It is the legislature's specific public policy objective to promote the development of small wineries. These small businesses face challenges entering the industry and it is the legislature's public policy objective to assist these wineries to grow and stabilize. Small wineries have faced significant challenges in recent years including the great recession, COVID-19 restrictions, impact of wildfire smoke, and weather challenges. Every year dozens of small wineries close their doors forever. The loss of these businesses means Washington loses not just the wine excise tax income from these wineries, but also the sales and use tax income, the business and occupation tax income, and the jobs, tourism opportunities, and community contributions these wineries would otherwise make.
The joint legislative audit and review committee must conduct an initial evaluation of the tax preference in this section by January 1, 2028. A final evaluation of the tax preference in this section must be conducted by January 1, 2033.
If the review finds that the: (a) Number of wineries producing less than 20,000 gallons per year going out of business is decreased; (b) number of wineries that were producing less than 20,000 gallons per year in 2023 that are subsequently producing more than 20,000 gallons per year is increased; or (c) amount of sales and use tax collected by wineries has increased, then the legislature intends to extend the expiration date of this tax preference.
In order to obtain the data necessary to perform the review in subsection (5) of this section, the joint legislative audit and review committee may refer to any data collected by the state, including the Washington wine commission.