I own and operate LYON Distilling Company in Saint Michaels, Maryland. For the past six years we have made remarkable American rum & whiskey here on the Eastern Shore, hired and trained dozens of people, delighted thousands of visitors, and become a community partner to local organizations through continued support and sustainable philanthropy.
I am writing to raise the awareness of a key issue facing small, craft distillers across the U.S. If Congress does not act by December 31, 2019, Federal Excise Taxes on small distillers will rise by 400%. We are urging the U.S. Congress to act as soon as possible to prevent this.
America’s craft distilling industry has gone from “emerging” to “exploding” in the last decade. When we opened LYON there were just over 100 craft distilleries across the country, and only one operating in Maryland. Today, there are over 2,000, with nearly 30 in Maryland. The craft spirits industry is experiencing a true renaissance – spirit manufacturing has returned to small towns and cities across America, and customers are more educated, interested, and invested in, local, innovative spirits.
Unfortunately for distillers and consumers, the Federal Excise Tax imposed on craft spirits has been disproportionately high for years. In 2017, for the first time in recent history, Congress lowered the Federal Excise Tax for craft distillers. This effectively provided parity with the craft beer and wine industries that enjoyed a lower tax based on their small size as well, which in turn led to the incredible boom in craft beers and boutique wineries.
The lower tax is indeed having the impact that Congress envisioned it would. Small distilleries like us are re-investing in their businesses, hiring new employees, purchasing American-made equipment, and seeking out American agriculture products. LYON has invested in new equipment to expand production 10x over, increased our physical footprint to nearly double the size of our original space, launched distribution in 5 states, and grown a team of 12 employees.
This provision enjoys wide support in Congress. 75 Senators and over 300 House Members have co-sponsored legislation to make this a permanent feature of the tax code. We reiterate our call for Congress to act by the end of 2019 to keep the lower tax rate in place for craft distillers and to allow the spirits renaissance to continue!
Jaime Windon
CEO/Founder | Lyon Distilling Company
President | Maryland Distillers Guild
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