I thought I remembered reading that the maximum increase a large Winery could get would be about $450,000? was I mistaken about that?
Dunno, but that would certainly be more sane.
Wes, I don’t think Gallo’s benefit is that great. The cut off is at 300k cases for the wine-specific tax credit. So for a huge company like Gallo the benefit isn’t that great. Much bigger news for them is the lowering of the corporate tax rate.
The tax reduction appears “progressive” in the sense of taking a smaller % from smaller producers:
https://www.winesandvines.com/news/article/193703/Tax-Bill-to-Benefit-Vineyard-Owners
Also points out accelerates depreciation of vines
That article omits a few things and adds some new info. The tax credit was already progressive, so the impact of that on small wineries is not much - a change from 90 cents to a dollar per case. It also doesn’t mention the temporary nature of the amendment. This article does belie what the WI lobbyist cited in another claimed.
Extending the tax category for table wines upwards is certainly needed. A lot of moderately ripe wines are over 14%, so having some pain in the ass arbitrary headache in the normal ABV range for a mainstream winery. Even changing it to 14.5% would be a big relief. 16% is probably better. I don’t like the idea of tax incentives impacting wine styles.
On that, the base rate for sparkling wine is still ridiculously arbitrarily punitive. That needs to change. I’m sure the discrimination stems from the idea this is a luxury product, but plenty of sparklers clearly aren’t. Get the luxury bucks from income tax and sales tax, which are linked to value.
The 100% depreciation for planting is needed. It’s years before revenue from these investments are realized. If you’re going to be able to deduct these costs, it only makes sense to be 100% at the time you pay them. Otherwise you’re either delaying projects as you budget for them, or you’re carrying extra debt. That dampens activity that will generate profit, taxes, jobs…
The only thing that mystifies me about these provisions is the definition of a “small” winery. A hundred thousand cases?! That’s getting well into the medium size, if not large in my books. Another question is whether some of the mega-wineries will try to break things up so that individual operating entities remain eligible for the “small” winery tax breaks.