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May, 2012

NEW JERSEY: WINERIES FACE LICENSING CHALLENGES

As our friends in New Jersey know, the new shipping law went into effect May 1. Unfortunately it includes a capacity cap that bans shipments from medium and larger wineries producing more than about 100,000 cases, excludes retailers, and imposes large licensing fees on wineries. And now that we have seen the winery licensing requirements, they also present obstacles. Some wineries will be required to establish a “nexus” in New Jersey, requiring separate tax filings, etc. So we can expect there will be delays, at least, in wineries seeking shippers’ licenses from New Jersey.

OTHER LEGISLATIVE UPDATES:

Massachusetts: HB 1029 Still Alive
As previously reported, this positive direct shipping bill was put on an "extension order" in March for consideration this spring. The latest news is that on May 17 the bill was put on a second extension order, joining about a dozen bills that the legislature will consider at a later date. There appears to be support for the bill if it can get a vote in the Assembly and Senate, but this is certainly frustrating.
Pennsylvania: Bills Still Alive
While Senate Bill 790 passed the Senate on March 28, it has not been voted on in the House, which is considering HB 845. Both bills have not resolved the excessive tax structure for future DTC shipments. The bills tack on taxes — 6% sales plus 18% flood tax, to the retail price. Wine industry representatives continue to negotiate a solution and we will continue reporting on progress.
US House Resolution 1161: Little Activity
There are few updates on HR 1161. The bill continues to have a little over 100 House co-sponsors, but no companion bill in the Senate or a scheduled hearing before the U.S. House Judiciary Committee. The national association of wine and spirits wholesalers (WSWA) has said it no longer is pursuing this legislation.

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