00                             HOUSE BILL NO. 35                                                                          
01 "An Act relating to a reduction in the state alcoholic beverage tax for certain small                                   
02 domestic wine producers."                                                                                               
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1.  AS 43.60.010(a) is amended to read:                                                                  
05            (a)  Except as provided in (c) and (d) of this section, every brewer, distiller,                         
06       bottler, jobber, retailer, wholesaler, or manufacturer who sells alcoholic beverages in                           
07       the state or who consigns shipments of alcoholic beverages into the state, whether or                             
08       not the alcoholic beverages are brewed, distilled, bottled, or manufactured in the state,                         
09       shall pay on all malt beverages (alcoholic content of one percent or more by volume),                             
10       wines, and hard or distilled alcoholic beverages, the following taxes:                                            
11                 (1)  malt beverages at the rate of $1.07 a gallon or fraction of a gallon;                              
12                 (2)  cider with at least 0.5 percent alcohol by volume but not more than                                
13       seven percent alcohol by volume, at the rate of $1.07 a gallon or fraction of a gallon;                           
14                 (3)  wine or other beverages, other than beverages described in (1) or                                  

01       (2) of this subsection, of 21 percent alcohol by volume or less, at the rate of $2.50 a                           
02       gallon or fraction of a gallon; and                                                                               
03                 (4)  other beverages having a content of more than 21 percent alcohol                                   
04       by volume at the rate of $12.80 a gallon.                                                                         
05    * Sec. 2.  AS 43.60.010 is amended by adding a new subsection to read:                                             
06            (d)  The amount of tax levied under (a)(3) of this section is reduced for a small                            
07       domestic wine producer that is allowed a tax credit under 26 U.S.C. 5041(c).  The                                 
08       amount of the reduction equals the amount of the credit that the producer is allowed                              
09       under 26 U.S.C. 5041(c).  To qualify for the tax rate reduction under this subsection, a                          
10       wine producer must file with the department an application for the reduced rate and                               
11       proof of the credit that is allowed to the producer under 26 U.S.C. 5041(c).  The                                 
12       department may establish by regulation additional requirements for applying for the                               
13       reduced rate.