In lobbying for the end of the tax, the distillers’ group suggested the industry could leave Kentucky. Jim Beam is owned by Japan-based Beam Suntory. Now many of the most recognized brands are part of international beverage conglomerates. During the same period, the super premium segment rose more than 20-fold to $1.3 billion. American whiskey revenues since 2003 have nearly quadrupled, reaching $5.1 billion last year, according to the Distilled Spirits Council of the United States. With small batch products, the liquor slowly became cool. While the tax changes take place, whiskey is booming.Īs a former Beam executive, Summers remembers a time when whiskey was a cheap, “bottom shelf” drink. “Even with this relief, distilling remains Kentucky’s highest taxed industry, paying $286 million in taxes each year,” Gregory said in an email. Another tax helps fire and emergency management services, though it does not apply in all counties. Kentucky Distillers’ Association President Eric Gregory noted the compromise bill creates a new excise tax to help fund school districts. I know there are, right now, probably some difficult feelings," Beshear said in a news conference. At the same time, you've got communities that have helped build that industry. You had an industry that supports so many jobs and calls Kentucky home. Andy Beshear, who signed the bill after passage by Kentucky's Republican-controlled legislature, said several industry compromises were vital to his support, while the bill will encourage investment. A destructive and unsightly black fungus which feeds on ethanol emitted by whiskey barrels has been found growing on property near the distillery's barrelhouses. Visitors walk to the Jack Daniels Distillery visitor center Wednesday, June 14, 2023, in Lynchburg, Tenn. “Where you have an alcohol-based plant that produces a hazardous material, you need emergency management, EMS, a sheriff’s department,” he said. The county will still have to provide them with services, protect them and protect the surrounding community from them if anything goes wrong, Summers said. Once the barrel tax sunsets in 2043, the distillers will pay no taxes at all to Bullitt on some warehouses. “Our industry was always a handshake agreement,” Summers said. When the state legislature voted to phase it out earlier this year, after intense lobbying by the Kentucky Distillers’ Association, county officials felt betrayed. The counties supported the property tax breaks because they expected to continue collecting the barrel tax. Many of the new barrelhouses are being built with industrial revenue bonds exempting them from property taxes for years or decades. Visitors walk away from the Jack Daniels Distillery visitor center carrying boxes of whiskey Wednesday, June 14, 2023, in Lynchburg, Tenn. The majority goes to schools but the money also is used for services that support the county’s Jim Beam and Four Roses plants, including a full-time fire department. “We’ve been their biggest advocates and they threw us under the bus,” said Jerry Summers, a former executive with Jim Beam and the judge-executive for Bullitt County, essentially the county mayor.īullitt County has long depended on an annual barrel tax on aging whiskey, which brought in $3.8 million in 2021, Summers said. By clicking Sign up, you agree to our privacy policy.
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