IN THE SENATE OF THE UNITED STATES
March 23, 2021
Mr. Wyden introduced the following bill; which was read twice and referred to the Committee on Finance
To amend the Internal Revenue Code of 1986 to ensure that kombucha is exempt from any excise taxes and regulations imposed on alcoholic beverages.
This Act may be cited as the
Keeping Our Manufacturers from Being Unfairly taxed while Championing Health Act or
Tax-free production of kombucha
Exception from definition of brewer
Subsection (d) of section 5052 of the Internal Revenue Code of 1986 is amended to read as follows:
For purposes of this chapter, the term brewer means any person who brews beer or produces beer for sale.
The term brewer shall not include any person who—
produces only beer exempt from tax under subsection (e) of section 5053, or
produces only kombucha exempt from tax under subsection (i) of such section.
Exemption from tax
Section 5053 of the Internal Revenue Code of 1986 is amended—
by redesignating subsection (i) as subsection (j), and
by inserting after subsection (h) the following new subsection:
Production of kombucha
Subject to regulation prescribed by the Secretary, any person may, without payment of tax, produce kombucha for consumption or sale.
For purposes of this chapter, the term kombucha means a beverage which—
is fermented solely by a symbiotic culture of bacteria and yeast,
contains not more than 1.25 percent of alcohol by volume,
is sold or offered for sale as kombucha, and
is derived from—
sugar, malt or malt substitute, tea, or coffee, and
not more than 20 percent other wholesome ingredients.
The amendments made by this section shall apply to calendar quarters beginning after the date of enactment of this Act.