By: Louis J. Terminello, Esq., and Brad Berkman, Esq.

This article examines the Craft Beverage Modernization Act (CBMA) and recent clarifications issued by the Alcohol and Tobacco Tax and Trade Bureau (TTB).

By now, most importers and producers are familiar with the CBMA and the tax credits available under it. As background, TTB is responsible, among other duties, for administering excise taxes for domestic and foreign producers of alcoholic beverages. In 2017, as part of the Tax Cuts and Jobs Act, the CBMA was enacted, reducing excise taxes on wine, beer and spirits produced at certain volume levels in the U.S., as well as on qualifying products produced abroad and imported into the U.S. The CBMA was initially intended as a temporary measure. However, in 2020, Congress made the law permanent and transferred administration of import excise taxes from U.S. Customs and Border Protection to TTB effective at the end of 2022.

Since its inception, taking advantage of the CBMA’s benefits has proven confusing and burdensome for domestic producers, importers of alcoholic beverages produced abroad, and the customs brokers who clear those imports on their behalf. Understanding recent developments is essential to avoiding noncompliance and potential administrative action.

Obtaining the reduced tax rates has become an increasingly technical process requiring coordination among foreign producers, importers, customs brokers and federal regulators. Recent regulatory developments, including final regulations adopted by TTB in September 2025, underscore the importance of understanding not only the tax benefits available under the CBMA but also the administrative requirements necessary to secure them.

September 2025 Final Regulation

On September 22, 2025, TTB adopted final regulations governing CBMA importer refund procedures, and made two important modifications permanent.

In its own summary, TTB states: “TTB is making permanent, with two changes, temporary regulations published in the Federal Register on September 23, 2022, relating to reduced excise tax rates and tax credits for imported distilled spirits, wines, and beer. This rule finalizes the procedures for industry members to claim limited reduced tax rates and tax credits for imported alcohol products that are entered for consumption in the United States. Specifically, this rule finalizes provisions in a temporary rule that outlines the process for foreign producers to assign reduced tax rates and tax credits to importers, and for importers to accept and apply the assigned tax benefits to imported products. This final rule clarifies that only the foreign producer who produces the product may assign the applicable tax benefits on distilled spirits, wine, or beer to U.S. importers, and extends by one calendar quarter the timeframe for those foreign producers to submit these assignments to TTB.”

Read the full article on The Grapevine Magazine beginning on page 36.

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