Text: S.926 — 116th Congress (2019-2020)All Information (Except Text)

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Introduced in Senate (03/28/2019)


116th CONGRESS
1st Session
S. 926


To amend the Internal Revenue Code of 1986 to ensure that kombucha is exempt from any excise taxes and regulations imposed on alcoholic beverages.


IN THE SENATE OF THE UNITED STATES

March 28, 2019

Mr. Wyden introduced the following bill; which was read twice and referred to the Committee on Finance


A BILL

To amend the Internal Revenue Code of 1986 to ensure that kombucha is exempt from any excise taxes and regulations 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 kombucha.

(a) Exception from definition of brewer.—Subsection (d) of section 5052 of the Internal Revenue Code of 1986 is amended to read as follows:

“(d) Brewer.—

“(1) IN GENERAL.—For purposes of this chapter, the term ‘brewer’ means any person who brews beer or produces beer for sale.

“(2) EXCEPTION.—The term ‘brewer’ shall not include any person who—

“(A) produces only beer exempt from tax under subsection (e) of section 5053, or

“(B) produces only kombucha exempt from tax under subsection (i) of such section.”.

(b) Exemption from tax.—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 kombucha.—

“(1) IN GENERAL.—Subject to regulation prescribed by the Secretary, any person may, without payment of tax, produce kombucha for consumption or sale.

“(2) DEFINITION.—For purposes of this chapter, the term ‘kombucha’ means a beverage which—

“(A) is fermented solely by a symbiotic culture of bacteria and yeast,

“(B) contains not more than 1.25 percent of alcohol by volume,

“(C) is sold or offered for sale as kombucha, and

“(D) is derived from—

“(i) sugar, malt or malt substitute, tea, or coffee, and

“(ii) not more than 20 percent other wholesome ingredients.”.