Ever wonder who grants operating permits to wineries? Or who approves the designation of new American Viticultural Areas (AVAs)? Or who reviews and approves wine labels? All these activities and more are the responsibility of the Alcohol and Tobacco Tax and Trade Bureau (TTB), a bureau within the Treasury Department which plays an important role in protecting the interests of wine consumers and the US wine industry. Here’s more on the agency’s activities and history.
TTB has responsibility for enforcing a broad variety of tax and trade regulations associated with the alcohol and tobacco industries. With a staff of approximately 500 people located around the county, the bureau collects excise taxes (US $23.4 billion in 2012), ensures product integrity, prevents misleading labeling and advertising of products, and works to ensure that the alcohol and tobacco marketplace is free from barriers that would stifle competition and act as a barrier to trade. “TTB’s activities benefit both the industry and the public because they ensure that lawful businesses, which act responsibly and benefit their communities with good local jobs and revenue, are not driven out of business by bad operators. Making misleading label claims, engaging in prohibited trade practices and failing to pay taxes cheats the consumer, robs communities of revenue, and hurts honest, hard-working businesses and people they employ,” notes Thomas Hogue, TTB’s Director of Congressional and Public Affairs.
In relation to wine, TTB’s specific responsibilities include:
- Collecting excise taxes from US wine producers (US$ 1 billion in 2012)
- Granting operating permits to wineries, wholesalers and importers
- Enforcing US labeling requirements, including reviewing and approving all wine labels (122,443 in 2012), conducting product integrity investigations, and testing product samples collected at random from the marketplace to confirm they are accurately labeled and the contents are consistent with the label
- Approving the designation of new American Viticultural Areas (AVAs) and American grape variety names
- Enforcing trade practice restrictions to ensure fair competition in the industry
- Providing technical expertise to the Office of the United States Trade Representative (USTR) on matters involving wine, and promoting exports of US wine by facilitating industry compliance with foreign requirements and working with foreign regulators to address barriers that block market access for US products
- Investigating consumer product complaints
The bureau traces its roots back to the creation of the Treasury Department and the first Federal taxes levied on distilled spirits in 1791, which paid off the United States’ Revolutionary War debt. TTB was created in January 2003, when the Bureau of Alcohol, Tobacco and Firearms (ATF), was extensively reorganized under the provisions of the Homeland Security Act of 2002. As a result of the act, the ATF’s responsibilities associated with firearms, explosives and arson moved to the Department of Justice and the tax and trade responsibilities related to alcohol and tobacco remained with the Treasury Department. “The reorganization was beneficial,” according to Mr. Hogue, “because now alcohol and tobacco matters do not have to compete for resources with firearms, explosives or arson. TTB is focused on alcohol and tobacco.”
For more information on TTB and its activities, visit the TTB website.