Starting January 1, 2023, changes to the Craft Beverage Modernization Act (“CBMA”) will require foreign producers of beer,wine, and distilled spirits to register with the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) before their US importers can take advantage of reduced tax rates or credits on the imported products. CBMA tax benefits are limited in quantity, and foreign producers may only assign a certain number of benefits to their US importers for each category of product imported.
Prior to 2023, US Customs and Border Protection (“CBP”) administered CBMA tax provisions for products imported into the US. Pursuant to the new changes to the CBMA, TTB will soon be responsible for administering CBMA tax benefits instead of CBP.
To take advantage of the tax credits, foreign producers must register with TTB using the online myTTB system; the current procedure of providing an authorization letter on the producer’s letterhead will no longer suffice. The registration process is fairly simple – the foreign producer is asked for basic information about the its business and ownership, its US Food & Drug Administration Food Facility Registration number, and to identify the foreign producer’s point of contact.
Once registered, the foreign producer will receive a TTB Foreign Producer ID, and an owner, officer, employee, or authorized agent of the foreign producer may assign the foreign producer’s tax benefits to its US importer. The US importer will need to provide the foreign producer’s TTB Foreign Producer ID to CBP during the Customs entry process, as well as when the importer submits CBMA import refund claim information to TTB. TTB will provide additional guidance on refund claims for US importers in early 2023.
TTB has already launched the foreign producer registration system. Additional guidance, including a user guide, can be found here.
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