KOMBUCHA

Keeping Our Manufacturers from Being Unfairly taxed while Championing Health Act or KOMBUCHA

This bill exempts low alcohol by volume kombucha from the excise tax on wine and beer and related regulations. Kombucha is a fermented tea with a low alcohol content.

[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6495 Introduced in House (IH)]

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118th CONGRESS
  1st Session
                                H. R. 6495

 To amend the Internal Revenue Code of 1986 to ensure that low alcohol 
by volume kombucha is exempt from any excise taxes and any regulations 
under chapter 53 of such Code which are imposed on alcoholic beverages.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 29, 2023

Mr. Blumenauer introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to ensure that low alcohol 
by volume kombucha is exempt from any excise taxes and any regulations 
under chapter 53 of such Code which are imposed on alcoholic beverages.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Keeping Our Manufacturers from Being 
Unfairly taxed while Championing Health Act'' or ``KOMBUCHA''.

SEC. 2. TAX-FREE PRODUCTION OF LOW ALCOHOL BY VOLUME KOMBUCHA.

    (a) Exemption From Tax on Wine.--Section 5042(a) of the Internal 
Revenue Code of 1986 is amended by adding at the end the following:
            ``(4) Low alcohol by volume kombucha.--
                    ``(A) In general.--Subject to regulations 
                prescribed by the Secretary, low alcohol by volume 
                kombucha shall not be subject to--
                            ``(i) tax as wine, or
                            ``(ii) the provisions of subchapter F.
                    ``(B) Definition.--For purposes of this chapter, 
                the term `low alcohol by volume kombucha' means a 
                beverage which--
                            ``(i) is fermented solely by a symbiotic 
                        culture of bacteria and yeast,
                            ``(ii) contains not more than 1.25 percent 
                        of alcohol by volume,
                            ``(iii) is sold or offered for sale as 
                        kombucha, and
                            ``(iv) is derived from--
                                    ``(I) fermentable sugars, including 
                                sugar, malt or malt substitute, honey, 
                                and fruit juice, and
                                    ``(II) plant materials, including 
                                tea and coffee.''.
    (b) Exemption From Tax on Beer.--Section 5053 of the Internal 
Revenue Code of 1986 is amended--
            (1) by redesignating subsection (i) as subsection (j), and
            (2) by inserting after subsection (h) the following new 
        subsection:
    ``(i) Production of Low Alcohol by Volume Kombucha.--Subject to 
regulations prescribed by the Secretary, low alcohol by volume kombucha 
(as defined in section 5042(a)(4)(B)) shall not be subject to--
            ``(1) tax as beer, or
            ``(2) the provisions of subchapter G.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to calendar quarters beginning after the date of enactment of 
this Act.
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