Department of the Treasury 

Alcohol and Tobacco Tax and 

Trade Bureau 

Congressional Budget 

Justification and Annual 

Performance Plan and Report 

FY 2023 
TTB - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement ................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .......................................................................................... 4

1.2 – Budget Adjustments Table ................................................................................................. 5

C – Budget Increases and Decreases Description ....................................................................... 5

1.3 – Object Classification (Schedule O) Obligations ................................................................ 7

D – Appropriations Language and Explanation of Changes ...................................................... 8

E – Legislative Proposals ............................................................................................................ 8

Section II – Annual Performance Plan and Report ................................................................... 9

A – Strategic Alignment ............................................................................................................. 9

B – Budget and Performance by Budget Activity .................................................................... 10

2.1.1 – Collect the Revenue Resources and Measures .............................................................. 10

Collect the Revenue Budget and Performance ......................................................................... 10

2.1.2 – Protect the Public Resources and Measures .................................................................. 15

Protect the Public Budget and Performance ............................................................................. 16

C – Changes in Performance Measures .................................................................................... 22

Section III – Additional Information ........................................................................................ 22

A – Summary of Capital Investments ....................................................................................... 22

 
TTB - 3 

Section I – Budget Request 

A – Mission Statement 

To collect taxes on alcohol, tobacco, firearms, and ammunition; protect consumers by ensuring 

the integrity of alcohol products; ensure only qualified businesses enter the alcohol and tobacco 

industries; and prevent unfair and unlawful market activity for alcohol and tobacco products. 

B – Summary of the Request 

Supporting the nation’s economic vitality is at the core of the work performed by the Alcohol 

and Tobacco Tax and Trade Bureau (TTB). The bureau’s role in permitting, regulating, and 

taxing the alcohol, tobacco, and firearms industries facilitates a compliant and fair marketplace 

for those engaged in the manufacture and trade of these commodities, and ensures that the 

Federal government has the resources needed to fund national priorities. In FY 2021, TTB 

collected approximately $20.3 billion in excise taxes from the alcohol, tobacco, firearms, and 

ammunition industries. 

The economic impact of COVID-19 is still reverberating across U.S. communities, including for 

many of the small breweries, wineries, and distilleries that comprise the majority of TTB 

taxpayers. At the FY 2023 funding level, and in support of the Administration’s economic 

recovery and growth priorities, TTB plans to focus on timely service levels and facilitating 

voluntary compliance by simplifying tax and regulatory requirements, modernizing its online 

filing systems, and issuing clear and timely industry guidance. These efforts will also increase 

market competition and ensure all have an equal opportunity to thrive. 

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

the government. In FY 2023, TTB plans to continue three major regulatory reform efforts in 

permitting, tax, and alcohol beverage labeling to consolidate, clarify, or simplify requirements 

and, where possible, minimize filing frequency. The revised requirements will ease the burdens 

placed on new and existing businesses and make it easier for them to voluntarily comply. At the 

same time, TTB plans to tailor the requirements to improve data quality and better detect risk to 

direct its enforcement efforts. As industry recovers and expands, these efforts are required to 

sustain service times and support all taxpayers in meeting their tax obligations. 

In FY 2023, TTB’s mission will also expand to include a new import claims program. The Craft 

Beverage Modernization Act (CBMA), as amended, transfers jurisdiction for import-related 

provisions from U.S. Customs and Border Protection (CBP) to Treasury as of January 1, 2023. 

Treasury intends for TTB to administer the new CBMA import claims program. TTB is taking a 

data-driven and risk-based approach to administer the new claims program to provide importers 

with CBMA tax benefits. The FY 2023 request supports the development and maintenance of 

custom information technology (IT) modules for foreign producers and importers to enable 

online filing and processing of claims as well as additional tax administration and enforcement 

staff necessary to timely issue refunds. 

At the FY 2023 funding level, TTB will also prioritize other improvements to its online filing 

systems as part of its 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 
TTB - 4 

platforms, TTB aims to increase electronic submissions, improve timely filings, and support 

taxpayer compliance. Reducing paper submissions also supports “green” filing practices in line 

with the Administration’s climate change agenda. 

TTB will also continue to focus on providing clear and consistent industry guidance to facilitate 

the submission of compliant filings. Omissions and errors on permit and alcohol label 

applications create inefficiencies for TTB and delays in service to industry. Undue delays in 

service can be a barrier to industry expansion and ongoing product innovation that fuel the 

economy. Further, to support these industries as they rebound, TTB plans to use compliance data 

to target and tailor its guidance, industry outreach, and enforcement activities, ensuring that 

businesses have the information they need to comply and are operating on a level playing field. 

1.1 – Appropriations Detail Table 

Dollars in Thousands 

 FY 2021 FY 2022 FY 2023 FY 2022 to FY 2023 

Appropriated Resources Operating Plan1 Annualized CR Request % Change 

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT 

Collect the Revenue 207 57,526 222 57,526 262 77,821 18.0% 35.3% 

Protect the Public 258 66,811 265 66,811 265 73,042 0.0% 9.3% 

Subtotal New Appropriated Resources 465 $124,337 487 $124,337 527 $150,863 8.2% 21.3% 

Other Resources 

Reimbursables and Offsetting Collections2 14 7,072 12 7,880 12 7,880 0.0% 0.0% 

Unobligated Balances from Prior Years3

 22 4,611 21 4,824 21 4,450 0.0% -7.8% 

Transfers In/Out

4

 0 1,087 0 838 0 0 NA -100.0% 

Subtotal Other Resources 36 $12,770 33 $13,543 33 $12,330 0.0% -9.0% 

Total Budgetary Resources 501 $137,107 520 $137,880 560 $163,194 7.7% 18.4% 1

FY 2021 New Appropriated Resources by Budget Activity reflect levels appropriated in P.L. 116-260, the Consolidated Appropriations Act of 

2021. FY 2021 Full-time Equivalents (FTE) and FY 2021 Other Resources reflect actuals. 

2

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

Financial Institution (CDFI) Fund, and Treasury Departmental Offices; and offsetting collections from Puerto Rico Cover-Over Program. 

3

All years include carryover of unobligated balances from 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 2021 actual obligations include a transfer from TEOAF Secretary's Enforcement and Strategic Support Fund. FY 2022 approved amounts 

includes approved TEOAF transfer from the Secretary's Enforcement and Strategic Support Fund. 
TTB - 5 

1.2 – Budget Adjustments Table 

Dollars in Thousands 

 FTE Amount 

FY 2022 Annualized CR 508 $124,337 

Changes to Base: 

2023 Maintaining Current Levels (MCLs): 0 $4,604 

Pay Annualization (2.7% average pay raise) 0 $572 

Pay Raise (4.6% average pay raise) 0 $2,942 

Non-Pay 0 $1,090 

Other Adjustments: 0 $6,993 

Adjustments to meet Current Operating Levels 0 $6,993 

Subtotal Changes to Base 0 $11,597 

FY 2023 Current Services 508 $135,934 

Program Changes: 

Program Increases: 40 $14,929 

CBMA Import Claims 40 $14,929 

FY 2023 President's Budget Request 548 $150,863 

C – Budget Increases and Decreases Description 

Maintaining Current Level (MCLs)............................................+$4,604,000 / +0 FTE 

Pay Annualization (2.7%) +$572,000 / +0 FTE 

Funds are requested for annualization of the January 2022 2.7% average pay raise. 

Pay Raise (4.6% in 2023) +$2,942,000 / +0 FTE 

Funds are requested for a 4.6% average pay raise in January 2023. 

Non-Pay +$1,090,000 / +0 FTE 

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

equipment. 

Other Adjustments...............................................................+$6,993,000 / +0 FTE 

Adjustments to meet Current Operating Levels, +$6,993,000 / +0 FTE 

Treasury requests adjustments to meet current services operating levels. Current operating levels 

include the annualization of the January 2021, 1.0% average pay raise, 2.7% average pay raise in 

January 2022, FY 2022 FERS Contribution Increases, and FY 2022 non-labor expenses. 

Program Increases...............................................................+$14,929,000 / +40 FTE

CBMA Import Claims, +$14,929,000 / +40 FTE 

TTB is requesting $14.9 million and 40 FTE to implement and administer CBMA provisions 

related to imported alcohol. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 made 

permanent most CBMA provisions of the Tax Cuts and Jobs Act of 2017, with several 

amendments, including transferring responsibility for administering the CBMA provisions 

related to imported alcohol from CBP to Treasury as of January 1, 2023. Treasury intends for 

TTB to administer the new CBMA import claims program. 

Under the law, starting in 2023, alcohol beverage importers will no longer be eligible for the 

CBMA tax benefits at the time of entry; rather, importers will be required to pay the full tax rate 
TTB - 6 

at entry and submit quarterly refund claims to TTB to receive the benefits. TTB anticipates that 

this program will roughly double its current claims workload, estimating that importers will 

submit approximately 7,000 claims per year for roughly $250 million in refunds. 

TTB requires additional resources to implement and administer the new import claims program 

so that current services and operations are not disrupted. This investment funds the full-year cost 

for the program, including: 

 IT Systems and Support, +$5,500,000 / +0 FTE

TTB plans to develop two online modules that will enable TTB to receive import claims and 

foreign producer assignments electronically as well as develop automated validations for 

these claims. 

 Foreign Producer Registration & Import Claims and Bond Processing, +$3,386,000 / +22 

FTE 

TTB requests additional staff to process foreign producer registrations, importer claims, and 

related submissions. 

 Enforcement and Risk Analysis, +$4,536,000 / +11 FTE 

TTB plans to develop risk-targeting tools to identify ineligible or fraudulent claims for 

review and field enforcement. TTB will also acquire new data sets to improve and maintain 

visibility into controlled groups. 

 Regulations and Guidance, +$1,009,000 / +5 FTE 

TTB requests additional staff to develop implementing regulations and industry guidance and 

to educate industry stakeholders on new requirements. 

 Administrative Support, +$498,000 / +2 FTE

TTB requests additional administrative support to address human resources-related needs. 
TTB - 7 

1.3 – Object Classification (Schedule O) Obligations 

Dollars in Thousands FY 2021 FY 2022 FY 2023 

Object Classification 

Actual 

Obligations 

Estimated 

Obligations 

Estimated 

Obligations 

11.1 - Full-time permanent 56,625 58,541 66,682 

11.5 - Other personnel compensation 1,008 1,005 1,095 

11.5 - Overtime 292 582 635 

11.9 - Personnel Compensation (Total) 57,925 60,128 68,411 

12.0 - Personnel benefits 20,805 21,573 25,241 

13.0 - Benefits for former personnel 0 5 5 

Total Personnel and Compensation Benefits $78,730 $81,706 $93,657 

21.0 - Travel and transportation of persons 389 1,544 1,903 

22.0 - Transportation of things 31 30 34 

23.1 - Rental payments to GSA 4,589 4,342 4,557 

23.3 - Communication, utilities, and misc charges 900 1,300 1,252 

24.0 - Printing and reproduction 204 315 329 

25.1 - Advisory and assistance services 10,285 10,489 22,164 

25.2 - Other services from non-Federal sources 14,886 15,805 17,812 

25.3 - Other goods and services from Federal sources 9,401 9,388 10,632 

25.4 - Operation and maintenance of facilities 21 22 24 

25.7 - Operation and maintenance of equip 3,295 3,295 2,621 

26.0 - Supplies and materials 289 375 388 

31.0 - Equipment 8,948 4,451 3,622 

32.0 - Land and structures 218 0 0 

Total Non-Personnel $53,456 $51,356 $65,336 

Total Obligations1 $132,186 $133,062 $158,993 

 

Full-time Equivalents (FTE)2 501 520 560 

*Amounts reflect obligations from all fund sources including annual appropriation, carryover balances, reimbursables, offsetting 

collections, and transfers. 

1

FY 2021 reflects actual obligations totaling $132.2 million, of which $125.1 million was from direct resources (new 

appropriations, carryover from prior years, and a TEOAF transfer) and $7.0 million was from reimbursable resources/offsetting 

collections. FY 2022 reflects anticipated obligations totaling $133.1 million, of which $125.5 million is from direct resources (new 

appropriations and carryover from prior years) and $7.6 million is from reimbursable resources/offsetting collections. FY 2023 

reflects anticipated obligations totaling $159.0 million, of which $151.1 million is from direct resources (new appropriations and 

carryover from prior years) and $7.9 million is from reimbursable resources/offsetting collections. 2

FY 2021 FTE reflects actual total FTE of 501, of which 487 FTE was from direct resources and 14 FTE was from reimbursable 

resources/offsetting collections. FY 2022 reflects anticipated total FTE of 520, of which 508 FTE is anticipated from direct 

resources and 12 FTE is anticipated from reimbursable resources/offsetting collections. FY 2023 reflects anticipated total FTE of 

560, of which 548 FTE is anticipated from direct resources and 12 FTE is anticipated from reimbursable resources/offsetting 

collections.

 
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D – Appropriations Language and Explanation of Changes 

Appropriations Language Explanation of Changes 

DEPARTMENT OF THE TREASURY 

ALCOHOL AND TOBACCO TAX AND TRADE BUREAU 

Federal Funds 

SALARIES AND EXPENSES 

For necessary expenses of carrying out section 1111 of the 

Homeland Security Act of 2002, including hire of passenger motor 

vehicles, $150,863,000; of which $5,000,000 shall remain 

available until September 30, 2024; of which not to exceed $6,000 

shall be available for official reception and representation 

expenses; and of which not to exceed $50,000 shall be available 

for cooperative research and development programs for 

laboratory services; and provision of laboratory assistance to 

State and local agencies with or without reimbursement. 

Note.—A full-year 2022 appropriation for this account was not 

enacted at the time the Budget was prepared; therefore, the Budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2022 (Division A of Public Law 117–43, as 

amended). The amounts included for 2022 reflect the annualized 

level provided by the continuing resolution. 

E – Legislative Proposals 

TTB has no legislative proposals. 
TTB - 9 

Section II – Annual Performance Plan and Report 

A – Strategic Alignment 

This year, TTB is working to align budget activities and performance measures to the new 

objectives in the Treasury FY 2022 – 2026 Strategic Plan. This work will include benchmarking 

performance and may result in changes to performance measures in the FY 2024 budget. TTB is 

responsible for administering and enforcing the sections of the Internal Revenue Code of 1986 

associated with the collection of excise taxes on alcohol, tobacco, firearms, and ammunition, and 

the Federal Alcohol Administration Act, which provides for the regulation of the alcohol 

beverage industry for the protection of U.S. consumers. TTB generally administers its 

jurisdiction according to five strategic goals that support U.S. economic growth and stability: 1) 

Business Qualification; 2) Labeling Modernization; 3) Tax Compliance; 4) Cross-Border Tax 

Risk; and 5) Workforce Readiness. TTB’s strategic goal of Workforce Readiness underpins 

TTB’s performance across all of its goals and objectives. 

TTB’s strategic goals to improve Tax Compliance and address Cross-Border Tax Risk ensure 

that the Federal government has the resources needed to fund national priorities through fair and 

effective administration and enforcement of tax laws. These efforts support Treasury’s 

Objective 1.1 (Tax Administration and Policy), which aims to enhance tax compliance and 

service, as well as improve tax policy design. The industries TTB regulates have grown 

significantly in recent years, which presents taxpayer service and enforcement challenges, 

particularly in light of recent tax reform legislation. These reforms expand TTB’s tax mission to 

include a new import claims program. This new program requires additional investments in TTB 

to ensure businesses are timely refunded for claims filed on imported alcohol beverage products 

and to prevent fraudulent claims. At the FY 2023 funding level, TTB will also continue its 

multi-year IT system modernization of outdated tax and regulatory systems to support efficient 

filing and processing. In addition, TTB plans to leverage technology to improve the TTB 

taxpayer experience and increase voluntary compliance, consistent with the Administration’s 

priorities. IT modernization also facilitates data analytics to timely detect fraud, tax evasion, and 

critical compliance issues that undermine a level playing field. 

TTB’s strategic goals to enhance Business Qualification and implement Labeling Modernization 

ensure that lawful U.S. alcohol businesses are competitive and thriving in the global 

marketplace. These efforts support Treasury’s Objective 1.3 (Economically Resilient 

Communities) by promoting economic recovery and growth for small businesses in communities 

across the country, including the thousands of breweries, wineries, and distilleries that TTB 

regulates. To this end, timely service remains a priority for TTB. As the demand for TTB 

services from these businesses continues to rise, and within the FY 2023 resources, TTB will aim 

to sustain improved service times for permit, label, and formula approvals. TTB will combine IT 

system modernization efforts with streamlined application requirements and enhanced guidance 

to achieve its performance goals for customer service. These strategies will help TTB maintain 

timely service by increasing the number of first-time approvals and reducing delays caused by 

extensive back-and-forth with industry members to correct application errors. 
TTB - 10 

B – Budget and Performance by Budget Activity 

2.1.1 – Collect the Revenue Resources and Measures 

Dollars in Thousands 

 

 Resource Level 

FY 2017 

Actual 

FY 2018 

Actual 

FY 2019 

Actual 

FY 2020 

Actual 

FY 2021 

Actual 

FY 2022 

Annualized 

CR 

FY 2023 

Request 

Appropriated Resources $53,560 $53,560 $58,856 $57,513 $57,526 $57,526 $77,821 

Reimbursable and Offsetting Collections $3,217 $3,923 $3,573 $4,131 $3,654 $4,807 $4,807 

Unobligated Balances from Prior Years $125 $112 $214 $98 $77 $113 $125 

Transfers In/Out $197 $902 $597 $349 $1,087 $419 0 

Budget Activity Total $57,099 $58,497 $63,240 $62,091 $62,344 $62,865 $82,753 

Full-time Equivalents (FTE) 223 212 213 211 211 226 267 

The FY 2017 - FY 2021 Appropriated Resources level represents the approved operating plan; all other resources in FY 2017 - FY 2021 

represent actual obligations. 

Performance Measure FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2021 FY 2022 FY 2023 

Actual Actual Actual Actual Actual Target Target Target 

Amount of Revenue Collected Per 

Program Dollar ($) 406 369 339 380 375 I I I 

Voluntary Compliance from Large 

Taxpayers - Overall (%) 90 90 91 91 93 95 95 95 

By Payment 99 99 99 99 99 - - - 

By Tax Return 79 82 84 84 87 - - - 

By Operational Report 82 82 83 83 87 - - 

Electronically Filed Tax Returns - 

Pay.gov (%) 35 37 41 43 48 55 60 65 

Electronically Filed Operational Reports - 

Pay.gov (%) 39 40 42 46 50 55 60 65 

Claims Processed within Service 

Standard (30-45 days) (%)1 71 85 85 85 

Key: I – Indicator 1

Includes current tax claim types, including drawback claims from manufacturers of nonbeverage products (30-day service standard) and all other 

claims (45-day service standard); in FY 2023, TTB will modify the measure to include CBMA import claims. 

Collect the Revenue Budget and Performance 

($77,821,000 from new direct appropriations, $125,000 from unobligated balances from the 

prior year, and $4,807,000 from reimbursable sources): 

This budget activity includes all tax processing, verification, enforcement, and outreach efforts 

related to administering the Federal tax code for alcohol, tobacco, firearms, and ammunition 

products. TTB collects approximately $20.3 billion in Federal tax revenue annually from a tax 

base of nearly 37,000 businesses. TTB’s regulated taxpayers include distilleries, breweries, and 

wineries, as well as manufacturers and importers of tobacco and firearms. 

TTB extends the reach of its enforcement resources through advanced analytics and risk-based 

audits and investigations. To ensure a level playing field for those engaged in the trade of these 

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

evasion and fraud to ensure all products sold in the marketplace are properly taxpaid. 

Other Resources.............................................................................. $4,932,000 

Unobligated Balances from the Prior Year..........................................................$125,000 

Offsetting Collections/Reimbursables............................................................. $4,807,000 

Other resources that fund this budget activity include unobligated balances from the prior year 

appropriation; reimbursement for the operating costs of TTB’s Puerto Rico field office, which 

are offset against the roughly $520 million in taxes collected on the alcohol beverage products 

that are manufactured in Puerto Rico and imported to the United States; reimbursement from 
TTB - 11 

Community Development Financial Institution (CDFI) for IT services provided by TTB; and 

funding from the Treasury Executive Office of Asset Forfeiture (TEOAF) Mandatory Fund to 

cover investigative expenses, data systems, and training. 

Description of Performance: 

TTB combines measures and indicators to demonstrate the effectiveness and efficiency 

with which TTB operates its tax administration function, including through facilitating 

voluntary compliance as well as field enforcement efforts to address critical threats to 

Federal revenues. Through FY 2023, TTB plans to improve tax compliance by updating 

its tax filings, processes, and technologies; enhancing its capacity to timely identify and 

address non-compliance through analytics and other detection tools; and continuing to 

improve taxpayer education and outreach. 

The Amount of Revenue Collected per Program Dollar indicator uses annual collections 

figures and the actual expenditures and obligations for collection activities to quantify the 

efficiency of the TTB tax collection program. In FY 2021, TTB achieved a return on 

investment of $375 for every program dollar spent on collection activities. 

Revenue from the alcohol, tobacco, and firearms and ammunition industries increased yearto-year, with alcohol collections up 4 percent, and firearms and ammunition excise tax 

collections up 66 percent. Tobacco collections continued to steadily decline, down another 4 

percent in FY 2021, in line with shifts in consumption patterns, product manufacturing, and 

trade. 

At the same time, TTB’s tax administration and enforcement costs have generally decreased 

over the past two years, as TTB continued to curtail much of its in-person enforcement 

activities due to the pandemic. TTB anticipates returning to a more robust in-person outreach 

and enforcement posture in FY 2022, guided by direction from the Administration and public 

health officials. 

Going forward, TTB will continue to monitor its return on investment for its Collect the 

Revenue activities as a key indicator; however, results will depend on several external factors, 

including the long-term effects of the craft beverage modernization provisions, and the 

duration and impact of the COVID-19 pandemic on TTB-regulated industries. 

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

$5,000

$7,000

$9,000

$11,000

$13,000

$15,000

$17,000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Collections (in Millions)

Alcohol and Tobacco Excise Tax Collections

Alcohol Tobacco

$50

$250

$450

$650

$850

$1,050

$1,250

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Collections (in Millions)

Firearms and Ammunition Excise Tax Collections

FAET
TTB - 12 

TTB. The Percent of Voluntary Compliance from Large Taxpayers is a key performance 

measure that shows the rate of compliance by large taxpayers (i.e., those that pay more than 

$50,000 in annual taxes) in voluntarily filing their required tax returns, operational reports, and 

payments on or before the scheduled due date. TTB uses its tax compliance data to improve the 

bureau’s ability to rate and prioritize taxpayers based on relative risk to ensure TTB addresses 

the most serious instances and patterns of non-compliance. 

To ensure adequate protection of Federal tax revenue, TTB established a high standard for its 

largest taxpayers, with a targeted filing compliance rate of 95 percent. In FY 2021, TTB 

achieved an overall compliance rate of 93 percent from its large taxpayers in meeting all tax 

filing requirements. The overall compliance rate increased from 91 percent in FY 2020. 

Payment compliance rates remained high at over 99 percent, indicating that the majority of 

reported liabilities were paid on time. Compliance rates for both tax returns and operational 

reports increased to 87 percent. These filings provide important information for tax verification 

and fraud detection, and require continued focus to improve compliance through FY 2023. 

As the taxpayer universe grows, and workloads increase, TTB has faced resource challenges in 

maintaining taxpayer service and voluntary compliance. In the last five years, the number of 

TTB taxpayers has increased over 40 percent, which has created additional workload and 

enforcement challenges, particularly in light of recent tax reforms. This growth has cut across 

industry types, with the most significant increases in small businesses entering the alcohol 

industry. Over time, with limited resources, TTB outreach efforts to educate industry members 

on tax requirements have also decreased. More recently, TTB had to defer planned tax policy 

and technology improvements and shift base resources to prepare to implement the new import 

refund claims program by the January 2023 statutory effective date. TTB has also faced 

competing enforcement priorities, including renewed efforts to address illicit trade practice 

activity in the alcohol industry, with directed funding for this purpose enacted in TTB’s 

appropriations since FY 2017. 

In FY 2021, to improve tax oversight, TTB refined its analytic tools and internal procedures to 

address identified non-compliance. New dashboard views of taxpayer compliance data include 

summary and detailed information about each compliance factor (i.e., late/missing tax returns, 

late/missing operational reports, late payments, and underpayments). Based on these data, TTB 

used streamlined procedures for reconciling taxpayer accounts and issuing assessments. At the 

same time, TTB employed new risk criteria for taxpayer referrals for field audits to address 

serious non-compliance issues that undermine the level playing field. These policy and process 

improvements proved effective, and have resulted in identified tax liabilities of $135 million and 

$32 million collections to date. While these assessments were necessary to protect revenue, at 

the same time, TTB also provided guidance to industry on payment options in cases of financial 

distress caused by COVID-19. 
TTB - 13 

At the FY 2023 funding level, improving compliance rates will remain a top priority. TTB 

plans to continue risk-based reviews of taxpayer accounts, with a focus on continued 

enhancements to analytic tools and expanding analysis into additional taxpayer segments. 

Over the next several years, TTB also plans to improve its education and outreach strategies 

to drive compliant behavior across TTB taxpayers, using compliance data to direct its annual 

outreach plan as well as to prioritize 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. 

TTB will also focus on increasing tax compliance by developing an improved and integrated 

online taxpayer experience, supported by the FY 2023 budget request. Today, TTB relies on 

Pay.gov, a Bureau of the Fiscal Service system designed for government payments, for the 

electronic filing of tax returns and operational reports. TTB’s two measures to monitor the 

Electronic Filing Rates for Tax Returns and Operational Reports in Pay.gov support ongoing 

efforts to reduce paper filings. 

Electronic filing rates for tax returns and operational reports trended positively in FY 2020, 

but remain low compared to other TTB e-filing systems. T TB ended the year at 48 percent of 

tax returns and 53 percent of operational reports submitted electronically, nearing or just over 

the annual target of 50 percent. These low rates impede TTB’s ability to timely and 

effectively detect and address non-compliance and add costs to making the data available for 

routine reconciliation or advanced analytics. Additional Pay.gov promotion is planned in 

FY 2022, and may improve e-filing rates; however, more significant tax system 

modernization is likely required for TTB to achieve its FY 2023 target of 65 percent, as well 

as its long-term target of 80 percent. 

At the FY 2023 funding level, and as part of its IT modernization efforts, TTB intends to 

implement phased releases to its tax system. Planned enhancements include a custom external 

interface to improve taxpayer options for electronic filing and enable online account 

Overall compliance trended down in the first part of the past 

decade – from 94% in FY 13 to 90% in FY 17. Recent 

enforcement efforts have increased overall taxpayer 

compliance to 93% in FY 21. Sustaining these 

improvements requires enhanced technology and guidance 

to support voluntary compliance by the increased number 

of TTB taxpayers. 

Compliance with tax payment remains high; however, 

lower compliance scores for required tax returns and 

operational reports pose challenges to verifying the taxes 

paid. In addition to IT and guidance, TTB plans to issue 

rulemaking to streamline its tax requirements to minimize 

filing burden and support voluntary compliance.

94%

90%

93%

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021

Large Taxpayers Oveall Compliance Rate

Overall Compliance

TARGET: 95%

100% 99% 99%

88%

79%

87%

87% 82% 87%

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021

Payments Tax Returns Operational Reports

Large Taxpayer Compliance Rate ‐ Overall Large Taxpayer Compliance Rate ‐ By Filing Type
TTB - 14 

management, as well as streamlined internal workflows to support TTB tax administration. In 

FY 2021, TTB continued to focus its IT development efforts on claims, completing the 

deployment of a new internal claims processing module to improve service times for issuing 

refunds on claims for manufacturers of nonbeverage products – filling a critical need for 

businesses potentially experiencing cash flow issues during the pandemic. In addition, TTB 

enhanced the web form for industry to file claims online, including improved security features, 

building on the interim solution deployed at the pandemic onset. TTB also continued critical 

identity management work, laying the groundwork for a single and secure industry member login 

across TTB’s online systems. 

These releases provide a foundation for the new integrated “myTTB” system, and prepare TTB 

to implement its new import claims jurisdiction. Starting in January 2023, TTB will be 

responsible for administering refund claims to importers eligible for reduced tax rates and credits 

under CBMA. These claims are currently administered by CBP; the Taxpayer Certainty and 

Disaster Tax Relief Act of 2020 transferred jurisdiction to Treasury as of January 1, 2023. 

Treasury delegated this authority to TTB. With FY 2023 funding, TTB will develop and 

implement two new IT systems modules – Foreign Producer Registration and Import Claims 

Submission/Processing. These modules are critical to TTB’s plans to implement the CBMA 

import refund claims program beginning in 2023, and include the associated security and data 

enhancements to facilitate implementation of the statute. TTB is adding a new measure of 

Claims Processed within Service Standard to monitor its ability to timely issue refund claims 

across all claims types. TTB’s service standards for drawback claims by manufacturers of 

nonbeverage products is 30 days; the service standard for all other claims is 45 days. CBMA 

import claims will be included beginning in FY 2023. In FY 2021, in baselining this new 

measure, TTB met its respective service standards for 71 percent of claims submissions. Going 

forward, TTB plans to continue focusing on process and IT system enhancements to support 

efficient claims filing and processing, with the aim of improving service levels and preventing 

potential service disruptions due to the anticipated influx of CBMA import claims. 

Effective tax administration also requires modernized IT systems to facilitate TTB’s datainformed approach to monitoring compliance and timely identifying potential tax evasion – 

which is even more critical in light of recent tax reforms. At present, resource-intensive manual 

analysis and reconciliation of multiple reports and returns by specialists, auditors, and 

investigators, in combination with other data sources, are required to detect and address high-risk 

activity. In the years ahead, and at the requested funding level, TTB plans to enhance its IT 

systems and analytics tools to facilitate TTB’s use of tax information to more effectively target 

its limited resources to suspected fraud or tax evasion schemes. 

At the FY 2023 funding level, TTB also plans to continue pursuing regulatory remedies to 

improve tax administration and industry compliance. TTB recognizes that a number of current 

tax-related reporting requirements are burdensome on industry and, in some cases, require 

significant TTB resources to administer. To address these issues, and to ensure that TTB’s tax 

requirements are commensurate with revenue risk, TTB completed a broad-based review of its 

tax return and operational report filing requirements. 

The review generated recommendations to significantly streamline requirements to decrease both 
TTB - 15 

the amount of information collected as well as the frequency with which it is collected. The 

review also incorporated changes to TTB requirements to address new risks to underreporting 

introduced by recent tax reforms. The net effect of these revisions would substantially reduce 

reporting and filing burdens for industry. 

This multi-year initiative will require rulemaking to implement. TTB will work these 

efforts in tandem with the IT modernization efforts funded through FY 2023 to deliver these 

new requirements through its new tax system interface. As TTB implements these efforts, 

the bureau will continuously evaluate and refine its regulatory and statutory options to find 

solutions to gain efficiencies for industry and TTB, while also boosting overall tax 

compliance. 

2.1.2 – Protect the Public Resources and Measures 

Dollars in Thousands FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 

 Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request 

Appropriated Resources $57,879 $57,879 $60,744 $60,744 $66,811 $66,811 $73,042 

Reimbursable and Offsetting Collections $2,637 $2,366 $2,666 $2,666 $3,418 $3,073 $3,073 

Unobligated Balances from Prior Years $125 $4,166 $4,865 $4,865 $4,534 $4,711 $4,325 

Transfers In/Out $0 $87 0 $0 $0 $419 $0 

Budget Activity Total $60,641 $64,498 $68,275 $68,275 $74,763 $75,014 $80,441 

Full-time Equivalents (FTE) 265 273 282 284 290 294 293 

The FY 2017 - FY 2021 appropriated resources level represents the approved operating plan; all other resources in FY 2017 - FY 2021 

represent actual obligations. 

Performance Measure FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2021 FY 2022 FY 2023 

Actual Actual Actual Actual Actual Target Target Target 

Permit Applications Processed within Service 

Standards (75 days) (%) 48 71 58 84 92 85 85 85 

Alcohol Beverage Label and Formula 

Applications Processed within Service Standards 

(15 days) (%) 1

62 84 48 83 92 85 85 85 

Initial Error Rate for Permit Applications (%) 82 78 71 62 67 25 25 25 

Initial Error Rate for Label and Formula 

Applications (%) 43 40 37 34 31 25 25 25 

Electronically Filed Permit Applications (%) 85 87 89 92 95 95 95 95 

Electronically Filed Label and Formula 

Applications (%) 98 98 99 99 100 I I I 

Customer Satisfaction Rate with eGov Systems - 

Permits Online (%) 68 77 68 78 79 80 80 80 

Customer Satisfaction Rate with eGov Systems - 

COLAs Online (%) 82 81 77 80 83 80 80 80 

Customer Satisfaction Rate with eGov Systems - 

Formulas Online (%) 2 70 79 70 73 80 80 80 80 

Key: I – Indicator 1 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 established service standards of 15 days for both labels and formulas; these standards have remained in effect through 

FY 2021. 

2 Results represent beverage alcohol filers only (nonbeverage alcohol formula submissions are excluded). 
TTB - 16 

Protect the Public Budget and Performance 

($73,042,000 from new direct appropriations, $4,325,000 from unobligated balances from the 

prior year, and $3,073,000 from reimbursable sources): 

This budget activity funds the programs that ensure the integrity of the products and industry 

members in the marketplace; promote compliance with Federal laws and regulations by more 

than 111,000 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. 

Other Resources................................................................................. $7,398,000 

Unobligated Balances from the Prior Year...........................................................$4,325,000 

Offsetting Collections/Reimbursables..................................................................$3,073,000 

Other resources that support this budget activity include unobligated balances from the prior year 

appropriation; reimbursement for the operating costs of the TTB Puerto Rico field office, which 

are offset against the roughly $520 million in taxes collected on the alcohol beverage products 

that are manufactured in Puerto Rico and imported into the United States; reimbursement by 

CDFI for IT services provided by TTB; and funding from the TEOAF Mandatory Fund to cover 

investigative expenses, data systems, and training. 

Description of Performance: 

TTB uses a combination of measures to monitor the degree to which the bureau is improving 

industry services and customer experience through meeting its established service standards 

for permit, label, and formula applications; reducing error rates on applications to address 

processing delays caused by incomplete or non-compliant submissions; and increasing the 

user satisfaction rates with TTB’s online systems. TTB’s strategies to achieve its 

performance targets for these measures include a combination of improving internal 

processes, streamlining application requirements, modernizing IT systems, and providing 

clearer guidance to industry members. 

TTB monitors its timeliness in processing permit applications through its measure of the 

Percentage of Permit Applications Processed within Service Standards. As businesses rely 

on accurate information related to TTB service delivery in their operational planning, this 

measure provides important data related to a key outcome for TTB and its stakeholders. 

In recent years, the volume of submissions, particularly in the more complex application 

types related to producing alcohol beverage products, had caused approval times to increase. 

Approval times spiked to an average of over 120 days in FY 2016 – and over 200 days for 

alcohol producer applications – delaying operations for these applicants, many of whom had 

already had made significant upfront investments. In response, TTB established a priority 

performance goal in FY 2018 to improve the timeliness and consistency of service levels by 

reducing average processing times for new permit applications by 20 percent and achieving 

its service standard for 85 percent of applicants. 

Under this priority goal, TTB has significantly improved its service levels for permitting and 

met both aspects of this goal for the first time in FY 2021. Average approval times are now 

down to 34 days, another 20 percent reduction compared to last year, and a reduction of 65 
TTB - 17 

percent since this goal was established. 

TTB also made substantial gains in the second part 

of its priority goal to improve the reliability of its 

service levels. In FY 2021, TTB exceeded its 

target to achieve the 75-day service standard for 85 

percent of permit applicants, ending the year at 92 

percent. After reaching historic highs last year, 

submission volume normalized in FY 2021 as new 

permit applications related to hand sanitizer 

production subsided, contributing to these results. 

TTB also made significant improvements to its 

management of in-process permit applications, 

using new dashboards that display key metrics on 

the status and age of applications to proactively 

identify and address any processing delays. 

 

Sustaining these performance improvements in 

FY 2023 and beyond will require continued 

progress on several crosscutting initiatives. At the 

requested funding level, TTB will focus on 

achieving its performance target through ongoing 

process improvements, updates to its permit applications to simplify and streamline 

requirements, and IT modernization efforts to improve customer experience with Permits 

Online. 

TTB will also continue to improve its procedures to screen permit applicants, refining the 

risk criteria, tools, and processes used to vet applicants for suitability to hold a Federal 

permit. TTB will use the results of its field investigations to inform its risk factors to improve 

the timeliness and effectiveness of its business qualification process. 

TTB measures the Initial Error Rate on Permit Applications, which tracks how many 

applications are submitted either incomplete or with errors, to develop directed strategies to 

maintain timely service by increasing the number of first-time permit application approvals. 

Errors increase the overall workload volume, requiring extensive back-and-forth with 

applicants to ensure the application is complete prior to TTB review and verification, which 

adds to the total processing time. 

Over the last five years, TTB’s ability to meet its service standard for new permit 

applications has been challenged by high error rates, which have reached over 80 percent. 

Error rates are highest for prospective breweries, wineries, and distilleries, which have more 

complex applications compared to non-manufacturers (i.e., wholesalers and importers). In 

FY 2021, TTB achieved an error rate on new permit applications of 67 percent, up from 62 

percent in FY 2020, but still down significantly from 82 percent in FY 2017. This increase 

was anticipated following the expiration of expedited review policies employed last year for 

hand sanitizer-related applications. As operations normalized in FY 2021, error rates 

48%

58%

92%

FY 2017 FY 2018 FY 2019 FY2020 FY 2021

Permits Meeting Service Standard (<75 Days)

Permits Meeting Service Standard(75 Days)

TARGET: 85%

96

62

75

42 34

FY 2017 FY 2018 FY 2019 FY 2020 FY 2021

Average Permit Approval Time (in calendar days)

TARGET: 75
TTB - 18 

increased, but are staying below 70 percent, indicating that recent efforts to streamline 

applications and processes are resulting in sustained improvements. Notably, error rates on 

brewery applications, an area of focused policy and process updates, have declined by 

approximately 10 percent since FY 2017. 

Going forward, TTB will continue to focus on reducing errors on permit applications that 

delay processing and frustrate applicants. The bureau expects significant progress in the next 

few years as it continues to simplify permit requirements and modernize IT systems to make 

filing easier. In FY 2021, TTB implemented a major IT system enhancement based on 

recommendations from a review of its process for returning permit applications for 

corrections. Previously, the Permits Online filing system did not allow an applicant to add or 

correct information on the application after it was submitted. Instead, it was handled via 

email exchange between the TTB specialist and applicant, creating processing inefficiencies 

and limiting effective oversight of in-process applications. As part of the IT modernization 

initiative, Permits Online now enables incomplete applications to be returned and corrected 

by the submitter within the system. Preliminary results indicate processing efficiencies as 

well as more effective communications with industry members that improve the user 

experience. The new functionality also provides TTB with better access to data on frequent 

errors to direct its system development efforts and improve online guidance. 

According to its measure of the Percent of Electronically Filed Permit Applications, which 

tracks the electronic filing rate for new business applications, TTB received 95 percent of 

permit applications via Permits Online in FY 2021. TTB attributes this ongoing increase to 

improvements in the Permits Online system, which provides improved guidance for first-time 

filers to navigate the application process. These system changes, combined with ongoing 

updates to online guidance available to industry, will continue to support TTB in achieving its 

FY 2023 targets to sustain electronic filing rates at or above 95 percent and reduce error rates 

on permit applications to 25 percent. 

 

As part of its strategy to optimize electronic filing systems, TTB measures Customer 

Satisfaction with the Permits Online eGov System through an e-mail survey to assess how 

satisfied businesses are in applying for a permit or registration through Permits Online. In 

FY 2021, system satisfaction rates increased to 79 percent, ending the year just short of the 80 

percent target. Notably, satisfaction continues to rise in conjunction with improved permit 

approval times, demonstrating a strong correlation between service levels and system 

satisfaction. 

TTB expects this positive trend to continue in line with improved service times, and as TTB 

implements broader system modernization efforts supported by FY 2023 funding to provide 

applicants with a single integrated online filing experience. Additionally, TTB will focus on 

improving the level of service at its call center for customers seeking live assistance with the 

permit application process. Going forward, and at the requested funding level, TTB will 

improve its use of call center data to understand customer pain points and support strategic 

system enhancements to improve customer satisfaction. 
TTB - 19 

Broader changes to TTB’s application requirements, some of which require rulemaking, are also 

underway. Using a zero-baseline approach in which no existing rule was taken for granted, TTB 

plans to modernize and streamline permit applications to minimize burden while meeting its 

statutory responsibilities and enforcement needs. The proposed changes are also informed by 

industry input on Treasury regulations that can be eliminated, modified, or streamlined to reduce 

burdens. 

In early FY 2022, TTB published the first in a series of proposed rulemakings to simplify permit 

applications, starting with distilled spirits plants. The proposed changes should dramatically 

reduce open text fields and requirements to upload supporting documentation. In addition to 

reducing compliance burdens, the simplified requirements should also reduce the number of 

initial permit applications submitted with errors, which should contribute to improved approval 

times. The requested funding level supports TTB plans to publish similar notices for breweries 

and wineries by the end of FY 2023. These changes may need to be fully implemented before 

TTB can achieve and sustain its targeted performance levels for FY 2023, particularly as the 

alcohol beverage industry continues to grow. 

In FY 2021, TTB received over 195,000 label and 28,000 formula applications for new alcohol 

beverage products. Given the importance of timely TTB approvals and the negative impact that 

delays have on U.S. businesses, TTB monitors its ability to provide timely and consistent service 

through its measure of the Percentage of Alcohol Beverage Label and Formula Applications 

Processed within Service Standards. TTB combines label and formula applications in this 

measure given the interdependent nature of these approvals. 

In the last five years, in line with industry expansion and product innovation, submission volume 

has increased 15 percent for labels and 100 percent for formulas. COVID-19 temporarily halted 

the growth in label applications in FY 2020. However, in FY 2021, submissions rebounded to 

near pre-pandemic levels, increasing 7 percent over FY 2020. Distilled spirits label applications 

continued to lead this trend, increasing more than 20 percent over last year and nearly 60 percent 

in the last five years, driven by ongoing product innovation. This innovation has also 

contributed to increased formula submission across all alcohol beverage commodities. Malt 

beverage formula submissions continue to increase at the fastest rate, up another 32 percent 

compared to last year, due to the use of novel ingredients and market trends toward flavored malt 

beverage products. 

In light of customer expectations, and supported by funding again enacted in the FY 2021 budget 

to accelerate approval times, TTB maintained a 15-day service standard for alcohol beverage 

label and formula applications in FY 2021. TTB set a performance target to meet this service 

standard for 85 percent of applications. Even as submission volume increased to pre-COVID 

levels, label performance improved in FY 2021. TTB ended the year at 93 percent of label 

applications meeting the 15‐day standard, exceeding its performance target. This was achieved 

through effective monitoring and management of the application backlog combined with 

strategic workforce management to efficiently deploy staff in response to submission 

fluctuations. B y employing similar strategies, TTB was also able to overcome significant 

increases in formula submissions to meet the 15-day standard for 92 percent of formula 

applications, also exceeding its performance target. By year-end, label and formula applicants 
TTB - 20 

received approval in just 6 days on 

average, well below the 15-day standard, 

and a significant improvement over the 

30 - 45 day standards that the bureau set 

and struggled to achieve in the past. 

TTB expects performance to continue to 

trend positively at the FY 2023 requested 

funding level through continuous queue 

management and strategic resource 

alignment. As a result, TTB intends to 

maintain its 15-day service standard for 

label and formula applications. TTB 

will also work to sustain its progress in meeting this standard for at least 85 percent of 

applications in FY 2023 through initiatives to modernize IT systems and guidance, with 

particular focus on high frequency application errors that increase total workload and challenge 

timely processing. 

Application errors are a key driver of label and formula processing times due to the 

additional review required for each resubmitted application. TTB uses its measure of the 

Initial Error Rate of Label and Formula Applications to monitor error trends and evaluate 

the effect of system and guidance enhancements on first-time approvals. In FY 2021, 

approximately 31 percent of label and formula applications were submitted incomplete or 

with errors, demonstrating continued year-to-year progress toward the targeted performance 

level of 25 percent. TTB made gains across commodity and application types. Notably, 

TTB ended the fiscal year at target for wine formulas and just above target at 26 percent for 

wine labels, proving the effectiveness of prior year strategies that focused on this 

commodity. 

In FY 2021, TTB continued to use a data-driven strategy to address the most frequent 

application errors, with the goal of increasing the number of applications that do not need to 

be returned for correction. TTB made progress in issuing improved guidance on TTB.gov 

for each alcohol beverage commodity. This includes detailed examples of compliant label 

and formula submissions by commodity, as well as web-based tools to make it easier for 

industry members to determine if their products require TTB formula approval prior to filing 

a label – a high frequency error. Going forward, TTB intends to further reduce error rates by 

increasing and integrating industry guidance available on TTB.gov and its online systems. 

Once complete, TTB will have completely refreshed its core labeling guidance in an easy-toread, user-friendly format to help improve compliant label submissions and reduce the 

burden of resubmissions on TTB and industry. 

In addition, TTB continued its initiative to modernize Federal alcohol beverage labeling 

regulations to reflect current TTB policy and modern industry practices. When finalized, the 

updated regulations will facilitate industry compliance through simplified regulatory 

standards and reduce burdens where possible. In April 2020, TTB published the first final 

rule in its phased labeling modernization rulemaking, codifying a number of liberalizing 

*Historic data adjusted to reflect the 15-day service standard for FY 2018 - 2021 to support trend analysis.

79%

93%

75%

92%

TARGET: 85%

FY 2017* FY 2018 FY 2019 FY 2020 FY 2021

Percentage of Applications Processed within Service Standards (15 days)

Labels Formulas

Label and Formula Applications Meeting Service Standard (15 Days)
TTB - 21 

proposals that received broad consensus and industry support. During FY 2021, TTB focused 

on updating industry guidance on TTB.gov so that industry could comply with and benefit 

from the new rules. Subsequent phases planned for fiscal years 2022 and 2023 will address 

specific labeling and advertising proposals for each alcohol beverage commodity, as well as 

crosscutting labeling issues. TTB will also indicate issues the bureau intends to close or 

reserve for future rulemaking. Through rulemaking, as well as policy guidance, TTB is 

seeking to equip industry with the information needed to submit more complete and accurate 

label and formula applications. 

Sustaining service levels in FY 2023 will also be supported through ongoing enhancements to 

TTB’s online systems. Over the last several years, TTB has deployed system enhancements to 

Certificate of Label Approvals (COLAs) Online and Formulas Online, focusing its efforts on 

compliance validations and embedded help features to address frequent application errors. These 

system releases have targeted both application errors (e.g., incomplete form fields) and label 

compliance errors (e.g., use of prohibited terms or images). FY 2021 results indicate that the 

changes implemented to date have proven effective, with error rates for label and formula 

applications ending the year at 31 percent, down 3 percent overall compared to last year, and 9 

percent since FY 2018. 

 

To be successful in this strategy, TTB must maintain high rates of electronic filing for label and 

formula applications. According to its measure of the Percent of Electronically Filed Label and 

Formula Applications, TTB now receives nearly 100 percent of applications via COLAs Online 

and Formulas Online, indicating that continued focus on system validations is warranted and will 

support performance goals in increasing accurate applications and accelerating approval times. 

In FY 2021, through its IT system modernization efforts, TTB expanded and improved systembased validations. These efforts included an enhancement to prevent the submission of label 

applications with low quality images. Problems with image legibility are among the top errors 

on label applications, and the system now flags low-resolution images so an applicant can 

address the error before they submit. Going forward, TTB plans to test the use of artificial 

intelligence to detect text and image errors on label applications, with the goal of alerting users 

to certain types of errors prior to submitting an application. As part of IT modernization, and at 

the FY 2023 funding level, TTB will also employ error data and user testing and feedback to 

make iterative enhancements to COLAs Online and Formulas Online to reduce application 

errors. 

Through its measures of Customer Satisfaction with COLAs Online and Formulas Online, TTB 

monitors user satisfaction with the process of submitting an application through its electronic 

filing systems, collecting responses via e-mail survey to assess factors such as ease of access, 

guidance, and overall experience. In FY 2021, satisfaction rates increased from 80 percent to 83 

percent for COLAs Online users, and 73 percent to 80 percent for Formulas Online users, 

meeting or exceeding the performance target for both systems. TTB attributes these increases in 

part to reduced processing times and anticipates that performance will continue to improve 

through FY 2023 in line with timely service levels. Further, TTB expects that system 

improvements funded at the FY 2023 request level, combined with regular review of survey 

feedback, will help TTB continue to exceed its user satisfaction target of 80 percent and attract 

users to its online systems to maintain its high electronic filing rates. 
TTB - 22 

C – Changes in Performance Measures 

Performance Measure or Indicator Proposed Change and Justification 

Claims Processed within Service 

Standard (30 - 45 days) (%) 

TTB is proposing to add a performance measure on 

the percentage of claims that meet service standards, 

which will capture the different types of TTB claims 

(drawback and other claims as of FY 2022, and 

CBMA import claims as of FY 2023). 

Section III – Additional Information 

A – Summary of Capital Investments 

Information Technology 

TTB’s Strategic Plan establishes the vision and objectives for the bureau in the business context. 

TTB’s Information Technology (IT) Strategic Plan is a five-year plan based on its business 

strategy, which includes the bureau’s mission, vision, goals, and objectives from an IT 

perspective. This plan charts the course the bureau will follow in the coming years to develop 

and implement IT solutions that are aimed at streamlining the collection of data, leveraging web 

technologies, and continuing to make the internet the method of choice for the reporting and 

exchanging of information between businesses and TTB. By aligning business and technical 

strategy, TTB is able to leverage technology to enable the bureau to meet its objectives in the 

most efficient and cost-effective manner while identifying ways to minimize system redundancy. 

TTB has no major IT investments based on the OMB and the Department of Treasury criteria. 

Several non-major investments, however, directly support the mission, strategy, and day-to-day 

operations of the bureau. These include: 

TTB Tax System: This investment consists of several component applications that ensure fair 

and proper collection of revenue from the industry members for alcohol, tobacco, firearms, and 

ammunition excise taxes and compliance with excise tax laws and regulations. 

TTB Regulatory System: This investment includes applications that streamline the beverage 

and nonbeverage alcohol formula approval process and COLA issuance for tax and regulatory 

compliance. 

TTB General Support Services: This investment provides TTB users with the infrastructure 

applications necessary to conduct daily business. 

TTB Enterprise Architecture: This investment supports strategic management of IT operations 

(e.g., business process redesign efforts not part of an individual investment, enterprise 

architecture development, capital planning and investment control processes, procurement 

management, and IT policy development and implementation) and costs for Chief Information 

Officer functions. 

In addition to leveraging IT to support the mission, strategy, and day-to-day operations of the 

bureau, TTB supports and maintains strategy alignment with OMB and Treasury through 

enterprise-wide IT initiatives. These include Cyber Security; IT Infrastructure; Electronic 

Identity and Access Management (HSPD-12); Enterprise-wide Contracts and Services; and 

Program Metrics and Milestones. 
TTB - 23 

Scientific Equipment for Laboratories 

This investment will enable TTB’s chemists to continue to provide accurate and reproducible 

scientific data and laboratory results to support regulatory compliance, tax enforcement, tax 

classification, rulemaking, and investigations for both the alcohol and tobacco commodities. 

Laboratory instruments require periodic replacement, as they have finite lifecycles due to use and 

as advances in scientific technology render older instruments obsolete. Periodic replacement of 

the existing technologies and equipment is essential for TTB laboratories to remain state-of-theart and effective to support the bureau’s mission, strategy, and day-to-day operations. 

A summary of capital investments, including major information technology and non-technology 

investments, can be accessed at: 

https://www.treasury.gov/about/budget-performance/Pages/summary-of-capitalinvestments.aspx.