Alcoholic Beverages And Beer Tax Guide

TENNESSEE TAXES ON ALCOHOLIC BEVERAGES AND BEERAlcoholic Beverage Commission(continued)The commission is authorized to investigateand/or arrest, without warrant or process, anyperson who the arresting officer has probablecause to believe is committing or attemptingto commit a felony in violation of Title 39,Chapter 17, Part 4, if the felony is committedon premises licensed by the commission, onany premises under investigation by thecommission in conjunction with its otherduties and responsibilities, or any otherpremises selling alcoholic beverages asdefined in Tenn. Code Ann. § 57-3-101,whether licensed or unlicensed. [Tenn. CodeAnn. § 57-1-210] License ClassificationsThe Alcoholic Beverage Commission mayissue, under provisions of state law, theclasses of licenses and permits listed below.Beer permits are issued by the respective cityor county government where theestablishment seeking the license is located.Licenses and permits issued by the AlcoholicBeverage Commission are:Licensing Procedures[Tenn. Code Ann. § 57-3-104]The Commission has the authority, by andwith the consent of the governor, to: employment. If a license or permit hasbeen issued, the commission shall issuea citation to the licensee or permittee toshow cause why the license or permitshould not be suspended or revoked. Alldata, written statements, affidavits,evidence, or other documentssubmitted in support of an applicationare a part of the application.Make, alter, amend, or repeal rules andregulations and prescribe all forms ofapplication, licenses, and tax stamps,and of all reports and other papers anddocuments required in the enforcementof Tenn. Code Ann. Title 57.Employ persons necessary for theeffective administration andenforcement of state law. It has the dutyand power to issue all licenses in respectto, or for, the manufacture,importation, bottling, keeping, givingaway, furnishing, possession,transportation, sale, and delivery ofalcoholic beverages, and to revoke anylicense whatsoever, that it has theauthority to issue.Refuse to issue a license or permit if,upon investigation, it finds that theapplicant for a license or permit hasconcealed or misrepresented anymaterial fact or circumstanceconcerning the operation of thebusiness or employment, or if theinterest of the applicant in the operationof the business or employment is nottruly stated in the application, or in caseof any fraud or false swearing by theapplicant touching any matter relating tothe operation of the business or 8Manufacturer’s, distiller’s, or rectifier'slicenseLiquor wholesaler’s licenseLiquor retailer’s licenseWinery license [Tenn. Code Ann. § 57-3207]Nonresident seller’s permit [Tenn. CodeAnn. § 57-3-605]Employee and server permits [Tenn.Code Ann. § 57-3-702]Winery Direct Shipper’s license [Tenn.Code Ann. § 57-3-217]Alcoholic beverage collector’s licenseWinemaking on premises facility licenseFarm wine permitRetail food store wine license [Tenn.Code Ann. § 57-3-803]

TENNESSEE TAXES ON ALCOHOLIC BEVERAGES AND BEERAlcoholic Beverage Commission(continued)Alcoholic Beverage Collectors[Tenn. Code Ann. § 57-3-209]Winery satellite permit [Tenn. Code Ann.§ 57-3-207(3)] Delivery service and delivery employeelicenses [Tenn. Code Ann. §§ 57-3-224,225] An “alcoholic beverage collector” is defined asa person who collects commemorative bottlescontaining alcoholic beverages, wine, ordistilled spirits and displays the collection in aplace available to the public, either byappointment or regular schedule, and whosells collectible alcoholic beverages for thepurpose of collection, without the intent thatthe collectible beverage would be consumed.Liquor retailers can have no more than tworetail licenses, except for those who holdmore than two licenses prior to April 12, 2016.[Tenn. Code Ann. § 57-3-406(a)]No new liquor store licenses will be issueduntil July 2, 2021, except in limited specificcircumstances, though existing licenses maybe transferred to another entity. [Tenn. CodeAnn. § 57-3-204(a)]A person qualifying as an alcoholic beveragecollector may apply to the Alcoholic BeverageCommission for an alcoholic beveragecollector’s license. The application fee for suchlicense is 300 and the annual license fee is 1,000. The license allows the collector topurchase beverages and to sell, in face-to-facetransactions, collectible beverages to personsaged 21 or older. Sales prices must be at least300% of the sales price of the same brand andquantity sold at retail.Any person, firm, or corporation desiring tomanufacture, distill, rectify, or sell wine orother alcoholic beverages must apply to thecommission, on forms furnished by thecommission, for a permit to do so. No person,firm, or corporation is authorized to engage inany of these activities until the permit isapproved and issued by the commission.There are general requirements for alllicenses and specific requirements that arepertinent to the type of license or permitrequired. For information regarding thelicensing requirements, fees, and procedures,please contact the Alcoholic BeverageCommission at (615) 741-1602. Any person,firm, or corporation desiring to brew or sellbeer should contact their local city or countygovernment for applicable information.Alcoholic beverage collectors are liable forpayment of all sales taxes due on such salesmade by the collector to others. If thecollector cannot demonstrate that thecollectible alcoholic beverage was purchasedfrom a licensed retailer, the collector will alsobe liable for payment of the appropriatewholesale gallonage taxes to the Departmentof Revenue.Wine Direct Shippers[Tenn. Code Ann. § 57-3-217]The same entity that grants the license has thepower to revoke the license for sufficientcause under Tenn. Code Ann. §§ 57-3-104(c)(1)and 57-5-108(a). Information relating to rules,procedures, applicable state and local laws,and license revocation and relief proceduresshould also be obtained from the licensingagency at the time of application.Any entity holding a federal basic permitissued under the Federal AlcoholAdministration Act and in the business ofmanufacturing, bottling, or rectifying wine canapply to the Alcoholic Beverage Commissionfor a winery direct shipper’s license. A personmeeting the licensing requirements and9

TENNESSEE TAXES ON ALCOHOLIC BEVERAGES AND BEERAny common carrier that willfully fails to makereports is subject to a notification of violation.Alcoholic Beverage Commission(continued)receiving a winery direct shipper’s license canmake sales and deliveries of wine by commoncarrier to Tennessee citizens 21 years of ageor older.In the case of a continuing failure to makereports, the Department may impose a fine ofup to 500 for each delivery not reported tothe Department. [Tenn. Code Ann. § 57-3217(h)(3)]Sales cannot exceed nine liters to anyindividual during a calendar month or twentyseven liters to one individual in a calendaryear.Winery Licenses[Tenn. Code Ann. § 57-3-207]Winery licenses may be issued to any entitymeeting the statutory requirements of Tenn.Code Ann. § 57-3-207. The license holder maymanufacture and bottle, but may not rectify,alcoholic vinous beverages unless the licenseholder also holds a license to distill and/orrectify alcoholic spirits. Wineries locatedoutside Tennessee may apply for and receivewinery licenses.There is a fee of 300 for the application andan annual license fee of 150.Winery direct shippers must also remit to theDepartment of Revenue the appropriateTennessee alcoholic beverage gallonage taxeson such sales as well as the required salestaxes resulting from such sales. Taxes will bedue not later than the 20th of the monthfollowing the month in which the sale wasmade.Applicants for winery licenses must remit afee of 300 with the license application. Thereis an annual license fee of 150, which mustbe remitted prior to issuance of an approvedlicense.Shipment of Wine ReportingEvery common carrier that contracts with awinery direct shipper for delivery of wine,beer, or other alcoholic beverages into thisstate is required to prepare and file with theDepartment of Revenue a monthly report ofknown shipments of wine, beer, and otheralcoholic beverages, though direct shipmentof beverages other than wine is notauthorized. The report must contain thename and business address of the shipper ofthe wine, beer or other alcoholic beverages,the name and address of each customerreceiving the wine, beer or other alcoholicbeverages, the weight of the packagedelivered to each customer, a unique trackingnumber, and the date of delivery.Licensed wineries may serve wine withoutcharge as complimentary samples for tastingat the winery and may sell wine at retail insealed containers at the winery, but not forconsumption in bonded areas. Wineries maydonate wine without charge to nonprofitreligious, educational, or charitableorganizations.Wineries may exchange wine in bulk withother wineries. Such exchange will not beconsidered a sale.In addition to its own wines, licensed winerieslocated in Tennessee may also sell on theirown premises items such as juices orconcentrates derived from any agriculturalproducts; items used in home winemaking;10

TENNESSEE TAXES ON ALCOHOLIC BEVERAGES AND BEERAlcoholic Beverage Commission(continued)sales of their wine products for consumptionoff the premises.gifts or tourism-related products; utensils andsupplies related to the use, consumption, orstorage of wine; fruit, cheese, and other snackfoods that can be paired with wine;nonalcoholic beverages; ice; coolers; tobaccoproducts; clothing and accessories related towine or the winery; and reading materialsrelated to wine. Wineries located outsideTennessee may sell such items as their statelaws allow. Tennessee wineries are prohibitedfrom selling distilled spirits, beer, and winenot manufactured or bottled on the premises.Nonprofit entities holding wine festivals mustobtain a special occasion license from theAlcoholic Beverage Commission in order toserve complimentary samples and make salesof wine for consumption off the premises.Wine Sales in Grocery StoresAny jurisdiction that has previously held

Self-Distribution Permits for Farm Wine Permit Holders 17 Restrictions on the Disposition of Alcoholic Beverages 17 Wine or Spirits Used in Food Preparation 18 Reports to the Commissioner 18 Inclusion of Liquor-by-the-Drink Tax in Menu Price 18 Returns and Payment 18 Extension 18 Failure to File Timely Returns 19 Records 19