Alcohol and Tobacco Tax and Trade Bureau 

Program Summary by Budget Activity

Dollars in Thousands

 FY 2022 FY 2023 FY 2024 FY 2023 to FY 20234

Budget Activity Operating Plan1 Operating Plan 1 Request $ Change % Change

Collect the Revenue $59,252 $76,895 $80,847 $3,951 5.14%

Protect the Public $68,815 $71,968 $74,757 $2,790 3.88%

Subtotal, TTB $128,067 $148,863 $155,604 $6,741 9.01%

Reimbursable and Offsetting Collections2 $8,533 $9,690 $9,690 $13,482 139.13%

Unobligated Balances from Prior Years3 $4,850 $4,450 $4,450 $23,013 517.13%

Transfers In/Out4 $821 $0 $0 $43,236 NA

Total Program Operating Level $14,204 $14,140 $14,140 $79,730 656.26%

Total Budgetary Resources $142,271 $163,003 $169,744 $86,471 665.27%

Direct FTE 479 548 551 3 0.55%

Reimbursable FTE 12 11 11 0 0.00%

Total Full-time Equivalents (FTE) 491 559 562 3 0.55%

1/ FY 2022 New Appropriated Resources by Budget Activity reflect levels appropriated in P.L. 117-103, the Consolidated Appropriations 

Act, 2022. FY 2022 Other Resources and Full-time Equivalents (FTE) reflect actuals. FY 2023 New Appropriated Resources by Budget 

Activity & FTE reflect levels appropriated in P.L. 117-328, the Consolidated Appropriations Act, 2023.

2/ Includes reimbursements from the Treasury Executive Office of Asset Forfeiture (TEOAF) Mandatory Fund, Community Development 

Financial Institutions (CDFI) Fund along with offsetting collections from Puerto Rico Cover-Over Program.

3/ All years include carryover of prior two-year set-aside funding for trade practice enforcement and recoveries of 50 percent in 

unobligated balances from prior one-year funding.

4/ FY 2022 actual obligations include a transfer from TEOAF Strategic Support & Secretary's Enforcement Fund.

Summary

The Alcohol and Tobacco Tax and Trade Bureau (TTB) serves as the Nation’s primary Federal 

authority in the taxation and regulation of the alcohol and tobacco industries. TTB is responsible 

for the administration and enforcement of the Internal Revenue Code (IRC) provisions for excise 

taxes on alcohol, tobacco, firearms, and ammunition, and the Federal Alcohol Administration 

(FAA) Act, which provides for the regulation of the alcohol beverage industry to protect U.S. 

consumers and ensures a fair and competitive marketplace for U.S. businesses. 

At the FY 2024 funding level, and in support of the Administration’s economic recovery and 

growth priorities, TTB plans to continue to focus on timely service levels and improving 

taxpayer experience by simplifying tax and regulatory requirements, modernizing online filing 

systems to improve the customer experience, and issuing clear and timely industry guidance to 

facilitate voluntary compliance. 

Service remains a top priority, as delays to issuing permits or product approvals have financial 

consequences for the viability of businesses. At the FY 2024 funding level, TTB expects to 

maintain permit, label, and formula approval times within service standards. Further, TTB will 

ensure access to tax benefits available to alcohol producers and importers under the permanent 

craft beverage modernization tax provisions, including by issuing timely refunds on import 

claims. In FY 2024, TTB plans to take a data-driven and risk-based approach to administering 

the new import claims program. The budget request supports ongoing enhancements to new 
online registration and filing systems, as well as the necessary tax administration and

enforcement staff, to administer this program. 

Complex or overly burdensome regulatory requirements do not serve the interests of taxpayers, 

consumers, or government effectiveness. In FY 2024, TTB plans to continue three major 

regulatory reform efforts in permitting, tax, and alcohol beverage labeling to consolidate, clarify, 

and simplify requirements and, where possible, minimize filing frequency. The revised 

requirements will ease burdens placed on new and existing businesses and make it easier to 

voluntarily comply. At the same time, TTB plans to tailor the requirements to improve data 

quality and better detect risk to direct enforcement efforts. Further, TTB will prioritize 

rulemaking to promote fair competition, including proposals that would expand information on 

alcohol beverage labels to provide greater transparency for consumers and alcohol producers. 

At the FY 2024 funding level, TTB will also continue to make critical investments in its online 

filing systems as part of its information technology (IT) modernization strategy to develop an 

integrated online experience for all tax and regulatory transactions with TTB. By improving the 

ease and usability of its online platforms, TTB aims to increase electronic submissions, improve 

timely filings, and support taxpayer compliance. Investments planned in FY 2024 focus on the 

initial phases of implementing simplified tax filings for all wineries, breweries, and distilleries, a 

priority focus for TTB, in its efforts to make compliance clearer and easier while addressing the 

fact that the industry still submits roughly half of all tax filings on paper. 

Budget Highlights

Dollars in Thousands

FTE Amount

FY 2023 Operating Plan 548 $148,863 

Changes to Base: 

Maintaining Current Levels (MCLs): 0 5,770 

Pay Annualization (2023 4.6% average 

pay raise) 1,038 

Pay Raise (5.2% average pay raise) 3,560 

Non-Pay 1,172 

Subtotal Changes to Base 0 5,770 

FY 2024 Current Services 548 $154,633 

Program Changes: 

Program Increases: 3 971 

Taxpayer Experience & Administration 3 971 

Subtotal Program Changes 3 $971 

FY 2024 President’s Budget Request 551 $155,604 

Note: In addition to the amounts requested above, a total of $2.5 

million from the Cybersecurity Enhancement Account will be 

allocated to support TTB’s Zero Trust Architecture.

Budget Adjustments

Maintaining Current Level (MCLs)............................................+$5,770,000 / +0 FTE 

Pay Annualization (4.6%) +$1,038,000 / +0 FTE

Funds are requested for annualization of the January 2023 4.6% average pay raise. 
Pay Raise (5.2% in FY 2024) +$3,560,000 / +0 FTE 

Funds are requested for a 5.2% average pay raise in January 2024. 

Non-Pay (2.0% in FY 2024) +$1,172,000 / +0 FTE

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, 

and equipment. 

Program Increases...............................................................+$971,000 / +3 FTE

Taxpayer Experience & Administration, +$971,000 / + 3 FTE

TTB is requesting $971 thousand and 3 FTE to invest in improvements to transform the TTB 

taxpayer experience and tax administration through simplified tax filings. Through a 

combination of tax expertise and customer engagement, TTB plans to initiate implementation of 

redesigned tax returns, reporting requirements, and system enhancements to reduce compliance 

burden and to streamline and improve data collections. This investment will make it easier for 

taxpayers to comply, especially for the small businesses who comprise the vast majority of TTB 

taxpayers and cannot afford compliance staff to support their operations. 

Legislative Proposals 

TTB has no legislative proposals. 

Performance Highlights 

FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Budget Activity Performance Measure Actuals Actuals Actuals Target Target

Collect the Revenue Amount of Revenue Collected Per 

Program Dollar ($) * 380 375 336 I I 

Collect the Revenue Voluntary Compliance from Large 

Taxpayers - Overall (%) 91 93 93 95 95

Collect the Revenue By Payment 99 99 99 - - 

Collect the Revenue By Tax Return 84 87 87 - - 

Collect the Revenue By Operational Report 83 87 86 - - 

Collect the Revenue Electronically Filed Tax Returns -

Pay.gov (%) 43 47 51 65 65

Collect the Revenue Electronically Filed Operational 

Reports - Pay.gov (%) 50 53 56 65 65

Collect the Revenue Claims Processed within Service 

Standard (30-45 days) (%) 1 46 59 58 85 85

Protect the Public Permit Applications Processed within 

Service Standards (75 days) (%) 84 92 91 85 85

Protect the Public 

Alcohol Beverage Label and Formula 

Applications Processed within Service 

Standards (15 days) (%) 2

83 92 93 85 85

Protect the Public Initial Error Rate on Permit 

Applications 62 67 64 25 25

Protect the Public Initial Error Rate for Label and 

Formula Applications 34 31 29 25 25

Protect the Public Electronically Filed Permit 

Applications - Original (%) 92 95 95 95 95

Protect the Public 

Electronically Filed Permit 

Applications - Amendments (%) 

(NEW) 3

85 83 79 90 90
Protect the Public Electronically Filed Label and Formula 

Applications (%) * 99 100 100 I I 

Protect the Public Customer Satisfaction Rate with eGov 

Systems - Permits Online 78 79 78 80 80

Protect the Public Customer Satisfaction Rate with eGov 

Systems - COLAs Online 80 83 83 80 80

Protect the Public Customer Satisfaction Rate with eGov 

Systems - Formulas Online 4 73 80 78 80 80

*Performance indicators do not have a target

1/ Claims services standards are set annually and vary by type: Manufacturer of Non-beverage Products = 30 days; Other Claims = 45 days; 

CBMA Import Claims = TBD. Current standards account for when interest starts to accrue to the government, as defined by statute. 

2/ Service standards are set annually based on TTB analysis of submission volume, error rates, and resource levels. In FY 2018, following a 

spike in submission volume, TTB set service standards of 15 days for both label and formula applications. TTB has maintained this standard 

through FY 2024.

3/ Results represent amendment submissions, with multiple permit amendment types often submitted on a single submission; the ability to 

submit multiple amendments via a single submission took effect in Q4 FY 2019.

4/ Results represent beverage alcohol filers only (nonbeverage alcohol formula submissions are excluded).

Description of Performance

In FY 2022, TTB met or exceeded the performance targets for 6 of its 13 performance measures. 

TTB also monitored performance through several key indicators that support data-driven 

decision making across TTB’s strategic goals. Despite falling short in seven performance goals 

in FY 2022, TTB made substantial improvements in many key service and operational measures. 

To meet its performance goals in FY 2024, TTB will implement an ambitious agenda that 

integrates policy updates, process improvements, modern technology, and data-driven outreach 

and enforcement. 

TTB’s Collect the Revenue budget activity includes all tax processing, verification, enforcement, 

and outreach efforts related to administering the Federal excise tax on alcohol, tobacco, firearms, 

and ammunition products. In ensuring a level playing field for those engaged in the trade of 

these regulated commodities, TTB takes appropriate enforcement action to detect and address tax 

evasion and fraud to ensure all alcohol and tobacco products sold in the marketplace are properly 

taxpaid. 

In FY 2022, TTB collected excise taxes totaling $19.6 billion from a tax base of nearly 39,000 

taxpayers, comprised of $10.1 billion for tobacco products, $8.3 billion for alcohol beverage 

products, and $1.2 million for firearms and ammunition. The investments in the Collect the 

Revenue activity resulted in the following performance highlights and accomplishments during 

FY 2022: 

• TTB returned $336 for every dollar invested in its tax collection activities.

• Electronically filed tax returns and operational reports trended positively in FY 2022, with 

roughly half of TTB tax submissions submitted to TTB via Pay.gov, a Bureau of the Fiscal 

Service system that TTB relies on for the e-filing of tax returns, tax payments, and 

operational reports. Ongoing high rates of paper filings make compliance monitoring and 

fraud detection more difficult and costly, however, and have a higher environmental impact. 

As part of its IT modernization efforts and to increase electronic filing, TTB plans to 

implement phased releases to its tax system, including a custom external interface for the 

direct submission of tax filings with TTB (rather than via Pay.gov) and account management 

capabilities, as well as enhanced internal workflows to support TTB tax administration. At 

the FY 2024 funding level, efforts will focus on implementing redesigned tax filing 

requirements to reduce compliance burden and to streamline and improve data collections. 
This investment will also make it easier for taxpayers to comply by combining operational 

reports and tax returns into a single submission. 

• Fostering voluntary compliance among taxpayers is a primary tax administration strategy for 

TTB. TTB evaluates voluntary compliance by measuring the percent of taxpayers who 

voluntarily file their required tax returns, operational reports, and payments on or before the 

scheduled due date. In recent years, the Bureau has made progress in reversing the declining 

filing compliance trend for its large taxpayers, defined as those with $50,000 or more in 

annual tax liability. Given the revenue exposure, TTB set a high target for filing compliance 

for its largest taxpayers at 95 percent. In FY 2022, TTB achieved an overall compliance rate 

of 93 percent from its large taxpayers in meeting all tax filing requirements, sustaining 

progress achieved last year. Payment compliance rates remain high, at over 99 percent, 

indicating that the majority of reported liabilities were paid on time. Compliance rates for 

timely filed tax returns remained at 87 percent in FY 2022, and compliance rates for timely 

filed operational reports dipped slightly to 86 percent, warranting continued focus on these 

filing requirements in the year ahead. At the FY 2024 funding level, improving compliance 

rates will remain a priority for TTB. Strategies to advance them include continuing to review 

large taxpayer accounts based on compliance risk, implementing ongoing enhancements to 

analytics tools, and expanding compliance reviews into the next tier of taxpayer segments. 

To support taxpayers seeking to voluntarily comply, TTB plans to improve its education and 

outreach strategies across TTB taxpayers, using customer feedback, user testing, and 

compliance data to prioritize TTB outreach as well as the development of new online tax 

guidance. These strategies will prove critical to supporting and increasing compliance by the 

thousands of small businesses that TTB regulates.

• In FY 2022, TTB continued to focus IT development efforts on improving existing claims 

processes as well as developing new systems to administer the CBMA import claims

program beginning in FY 2023. For the majority of claims types, TTB met the 45-day 

service standard for 69 percent of submissions; however, for claims submitted by 

manufacturers of non-beverage products (MNBP), the highest volume claim type, TTB met 

the 30-day standard for only 46 percent of submissions. TTB also deployed enhancements to 

its existing module to support timely processing of MNBP claims, helping to reduce 

backlogs. As a result, the percent of MNBP claims meeting the 30-day service standard 

increased from 30 percent or less in the first six months of FY 2022 to approximately 70 

percent or more in the last six months of the year. In addition, TTB initiated development of 

a new module to enable industry to file claims online, which will replace the web form 

deployed as an interim solution at the pandemic onset. At the FY 2024 funding level, TTB 

will continue to deploy enhancements to its two CBMA import claims systems, including 

incorporating external data validations and adding usability enhancements to support 

effective claims processing. This is a key strategy to ensure that TTB maximizes its capacity 

to maintain timely service despite the influx of new import claims beginning in FY 2023, 

which TTB expects to nearly double the number of claims submitted to TTB.

TTB’s Protect the Public budget activity funds the programs that ensure the integrity of alcohol 

beverage products and industry members in the marketplace; promote compliance with Federal 

laws and regulations by the more than 119,000 businesses that TTB regulates; facilitate fair and 

lawful domestic and international trade in the alcohol and tobacco commodities; and provide full
and accurate alcohol beverage product information to the public as a means to prevent consumer 

deception. 

The investments in the Protect the Public activity resulted in the following performance 

highlights and accomplishments during FY 2022:

• Federal law prohibits the import or domestic bottling of an alcohol beverage without an 

approved Certificate of Label Approval (COLA), making this service integral to U.S. 

businesses and economic recovery priorities. In FY 2022, TTB received more than 193,000 

label applications and 27,000 formula applications for new alcohol and beverage product 

approvals. While submission volume remains high, reflecting industry expansion and 

product innovation in recent years, signals of industry recovery slowed in FY 2022, with total 

label applications down roughly one percent. TTB ended the year at 93 percent of label 

applications meeting the 15‐day service standard, exceeding the 85 percent target. This was 

achieved through effective monitoring and management of the application backlog combined 

with strategic workforce deployment in response to submission fluctuations. In terms of 

formula applications, after years of double-digit growth, applications decreased for the first 

time in FY 2022, down over five percent compared to last year. By employing similar 

strategies, TTB exceeded the targeted performance level, ending the year at 90 percent of 

formula applications meeting the 15-day standard, despite staffing shortages in the 

formulation office due to attrition.

• A TTB permit or registration is required before a business can lawfully operate in the alcohol 

and tobacco industries, and TTB ensures a fair and lawful marketplace by screening permit 

applicants to ensure only qualified persons engage in operations. In FY 2022, TTB received 

approximately 8,200 applications for a Federal permit or registration, and qualified 

approximately 6,400 new businesses, predominantly small businesses. Although the annual 

rate of growth has slowed, the overall application volume remains high compared to historic

levels, particularly in some of the more complex permit application types related to 

producing alcohol beverage products. Despite these trends, TTB has achieved and sustained 

significant improvements in its service levels for permitting in recent years. Average 

approval times are now 36 days, sustaining progress achieved last year. Additionally, TTB 

surpassed its target to issue permits within the 75-day service standard for 85 percent of 

applicants, ending the year at 91 percent. TTB achieved these performance gains in part due 

to TTB’s improved management of in-process permit applications and by continuing to 

cross-train specialists to allow management to redeploy staff as necessary to cover 

fluctuations in application types. Going forward, TTB plans to achieve its performance 

target through ongoing process improvements and updates to its permit applications to 

simplify and streamline requirements. At the FY 2024 requested funding level, TTB will 

also continue its IT modernization efforts to improve the customer experience with Permits 

Online, including enhanced guidance and self-service features to help applicants submit 

compliant applications.

• TTB continues to make progress in reducing the error rate on initial permit, label, and 

formula applications, a critical strategy to maintaining timely service across these programs.

For each application type, the Bureau is targeting a 25 percent error rate in submissions to 

TTB. Although TTB has not yet achieved this target, the Bureau has made significant 

progress in each application area. For permit applications, the FY 2022 error rate was 64 

percent, an improvement of approximately 15 percent over the past five years, indicating that
efforts to streamline applications and processes are resulting in sustained improvements. The 

Bureau expects additional progress in the next few years as it continues to simplify permit 

requirements and improve IT systems to make filing easier. TTB also continued to 

substantially reduce error rates for label and formula applications in FY 2022, with error 

rates at 29 percent and 28 percent, respectively. These gains demonstrate the ongoing 

effectiveness of prior year strategies that focused on reducing errors through targeted 

guidance, system validations, and analysis of high frequency errors. At the FY 2024 funding 

level, TTB plans to continue its data-driven strategy to better understand customer pain 

points to develop effective guidance and system enhancements that will improve the overall 

customer experience and reduce errors on TTB submissions.

• System enhancements to date have resulted in high rates of customer satisfaction with TTB’s 

eGov systems. TTB monitors user satisfaction with the process of submitting an application 

through its eGov systems, collecting responses via e-mail survey to assess factors such as 

ease of access, guidance, and overall experience. In FY 2022, satisfaction rates held at 83

percent for COLAs Online users, exceeding the 80 percent performance target; however, 

satisfaction rates declined slightly from 80 percent to 78 percent for Formulas Online users

and from 79 percent to 78 percent for Permits Online users. At the FY 2024 funding level, 

TTB expects system satisfaction rates to exceed the 80 percent target as the Bureau engages 

in broader modernization efforts to provide applicants with a single integrated online filing 

experience, including through the regular review of survey feedback.

• TTB also continues to sustain high electronic filing rates. In FY 2022, nearly 100 percent of 

all label and formula applications continued to be submitted via COLAs Online and

Formulas Online, and 95 percent of permit applications were submitted via Permits Online. 

TTB attributes the high rates of electronic filing to continued system improvements as well 

as ongoing promotion at industry conferences and seminars. At the FY 2024 funding level, 

TTB is proposing to add a performance measure on the electronic filing rate of applications 

to amend a Federal permit or registration. The data will come from Permits Online, TTB’s 

current online filing system for permit applications. This measure provides information on 

system use for this critical industry service and aids in monitoring the efficiency of program 

operations.