Alcohol and Tobacco Tax and Trade Bureau 

Program Summary by Budget Activity 

Dollars in Thousands 

FY 2020 FY 2021 FY 2022 FY 2021 to FY 2022 

Budget Activity Operating 

Plan 1

Operating 

Plan Request $ Change % Change 

Collect the Revenue $57,513 $57,526 $60,761 $3,235 5.62% 

Protect the Public $62,087 $66,811 $70,569 $3,758 5.62% 

Subtotal, TTB $119,600 $124,337 $131,330 $6,993 5.62% 

Reimbursable and Offsetting Collections2 $6,744 $7,977 $7,977 $0 0.00% 

Unobligated Balances Brought Forward3 $4,577 $4,696 $4,680 ($16) -0.34% 

Transfers In/Out4 $349 $350 $0 ($350) -100.00% 

Total Program Operating Level $131,270 $137,360 $143,987 $6,627 4.82% 

Direct FTE 484 508 508 0 0.00% 

Reimbursable FTE 11 12 12 0 0.00% 

Total Full-time Equivalents (FTE) 495 520 520 0 0.00% 

1/ FY 2020 Resources by Budget Activity reflect levels appropriated in P.L. 116-93, the Consolidated Appropriations Act of 2020. 

FY 2020 Full-time Equivalents (FTE) and FY 2020 Other Resources reflect actuals. 

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

Departmental Offices, and 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 education as well as recoveries of 50 

percent in unobligated balances from prior one-year funding. 

4/ Actual obligations (FY 2020) and approved allocation (FY 2021) from TEOAF Secretary's Enforcement Fund transfer. 

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. 

Many U.S. businesses experienced significant financial hardships due to the pandemic, including 

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

taxpayers. In FY 2022, in support of the Administration’s pandemic recovery and economic 

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

compliance by simplifying tax and regulatory requirements, issuing clear and timely industry 

guidance, and modernizing its online filing systems. 

At the FY 2022 funding level, TTB will make critical investments in online filing systems as part 

of its multi-year 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. Reducing paper submissions also supports “green” filing practices in line 

with the Administration’s climate change agenda. 
Additionally, TTB is working with Treasury on options to implement statutory changes that 

transfer responsibility for administering the Craft Beverage Modernization Act certain provisions 

related to imported alcohol from U.S. Customs and Border Protection to Treasury after 

December 31, 2022. The law requires that importers submit refund claims to Treasury to receive 

the reduced CBMA tax rates and credits as opposed to taking them at the time of entry. TTB and 

Treasury are still assessing the overall impact, including the resources, personnel, and 

information technology systems needed to implement and administer the import claims program. 

A report detailing Treasury’s plans to implement and administer the refund program starting in 

2023 will be submitted to Congress and made publicly available in June 2021 as required by P.L. 

116-260.

Budget Highlights 

Dollars in Thousands 

Alcohol and Tobacco Tax and Trade Bureau FTE Amount 

FY 2021 Operating Plan 508 $124,337 

Changes to Base: 

Maintaining Current Levels (MCLs): 0 $3,885 

Pay Annualization (1.0% average pay raise) 0 $196 

Pay Raise (2.7% average pay raise) 0 $1,774 

FERS Contribution Increase 0 $995 

Non-Pay 0 $920 

Subtotal Changes to Base 0 $3,885 

FY 2022 Current Services 508 $128,222 

Program Changes: 

Program Increases: 0 $3,108 

 MyTTB IT System Modernization 0 $2,500 

 Electric Vehicles and Associated Infrastructure 0 $608 

FY 2022 President’s Budget Request 508 $131,330 

Budget Adjustments 

Adjustments to Request 

Maintaining Current Level (MCLs)........................................... +$3,885,000 / +0 FTE 

Pay Annualization (1.0%) +$196,000 / +0 FTE 

Funds are requested for annualization of the January 2021 1.0% average pay raise. 

Pay Raise (2.7% in 2022) +$1,774,000 / +0 FTE 

Funds are requested for a 2.7% average pay raise in January 2022. 

FERS Contribution Increase +$995,000 / +0 FTE 

Funds are requested for the Federal Employee Retirement System (FERS) contribution rates 

effective FY 2022. 

Non-Pay +$920,000 / +0 FTE 

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

equipment. 
Program Increases................................................................. +$3,108,000 / +0 FTE

MyTTB IT System Modernization +$2,500,000 / +0 FTE 

TTB will continue to invest in IT system modernization to incrementally transform the industry 

member service experience across all permitting, tax, and alcohol labeling interactions. The 

desired end state, known as MyTTB, will provide a personalized “one-stop shop” to help 

industry members efficiently conduct all business transactions online. MyTTB will also facilitate 

improved data integration and data quality across TTB programs and systems, enabling TTB to 

better detect noncompliance and fraud, validate application data, automate workflows, and 

increase data-driven decision making. 

Electric Vehicles and Associated Infrastructure +$608,000 / +0 FTE 

Following the lead from Executive Order (E.O.) 14008, “Tackling the Climate Crises at Home 

and Abroad,” the U.S. Department of the Treasury joins in the Administration’s priority to 

develop a comprehensive plan to create good jobs and stimulate clean energy industries by 

revitalizing the Federal Government’s sustainability efforts. This includes Treasury’s 

commitment to use all available procurement authorities to augment its Department-wide fleet 

management program with a continued focus on the leasing of electric vehicles (EV) and 

purchasing, installing, and maintaining its essential infrastructure. The requested resources will 

help Treasury comply with the requirements of E.O. 14008 and reduce the carbon footprint of 

emissions into the atmosphere by acquiring an updated fleet of zero-emissions vehicles that can 

support mission operations. 

For FY 2022, TTB requests $608,000 to fund the conversion of its fleet to EV. Of that money, 

approximately $50,000 will be allocated to the purchase, installation, maintenance, and/or 

upgrade of infrastructure required to maintain an EV fleet management program, including 

charging stations to support its future EV fleet. Currently, TTB has a total of 21 vehicles in its 

fleet, none of which are EVs. 

Legislative Proposals 

TTB has no legislative proposals. 
Performance Highlights FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 

Budget Activity Performance Measure Actual Actual Actual Target Target 

Collect the Revenue Amount of Revenue Collected Per 

Program Dollar 369 339 380 I I 

Collect the Revenue Voluntary Compliance from Large 

Taxpayers - Overall (%) 1 90 91 91 95 95 

Collect the Revenue By Payment 99 99 99 - - 

Collect the Revenue By Tax Return 82 84 84 - - 

Collect the Revenue By Operational Report 82 83 83 - - 

Collect the Revenue Electronically Filed Tax Returns - 

Pay.gov (%) 37 41 43 55 65 

Collect the Revenue Electronically Filed Operational 

Reports - Pay.gov (%) 42 46 50 55 65 

Protect the Public Permit Applications Processed within 

Service Standards (75 days) (%) 71 58 84 85 85 

Protect the Public 

Alcohol Beverage Label and Formula 

Applications Processed within Service 

Standards (15 days) (%) 2

84 48 83 85 85 

Protect the Public Initial Error Rate for Permit 

Applications 80 71 62 25 25 

Protect the Public Initial Error Rate for Label and 

Formula Applications 40 37 34 25 25 

Protect the Public Electronically Filed Permit 

Applications (%) 87 89 92 95 98 

Protect the Public Electronically Filed Label and Formula 

Applications (%) 98 99 99 I I 

Protect the Public Customer Satisfaction Rate with eGov 

Systems - COLAs Online 81 77 80 80 80 

Protect the Public Customer Satisfaction Rate with eGov 

Systems - Permits Online 3 77 68 78 80 80 

Protect the Public Customer Satisfaction Rate with eGov 

Systems - Formulas Online 3 79 70 73 80 80 

Key: I – Indicator 

1/ TTB revised its measure of taxpayer compliance for FY 2020, enabling more accurate and timely analysis of compliance trends by taxpayers; 

the new method also supports separate reporting of compliance rates by payments, tax returns, and operational reports. 

2/ Service standards are set annually based on TTB analysis of submission volume, error rates, and resource levels. In FY 2016, the service 

standards were 30 days for labels and 45 days for formulas. In FY 2017, TTB set the service standards at 10 days for both labels and formulas, 

after receiving dedicated funding to support accelerated processing times. In FY 2018, following a spike in submission volume, TTB established 

new service standards of 15 days for both labels and formulas; these standards remain in effect through 2020. 

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

Description of Performance 

In FY 2020, TTB met or exceeded the performance targets for 5 of its 14 performance measures. 

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

decision making across TTB’s strategic goals. Across its performance measures, TTB made 

substantial improvements in FY 2020 in key service and operational measures, with most 

trending in a positive direction by year-end, demonstrating TTB’s effective balancing of 

competing priorities during COVID-19 to address critical emerging risks while still providing 

improved service levels to industry. To meet its performance goals in FY 2022, TTB will 

implement an aggressive strategic agenda that integrates policy updates, process improvements, 

and modern technology, as well as 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 also takes appropriate enforcement action to detect and address 

diversion activity and ensure all products sold in the marketplace are properly taxpaid. In 

FY 2020, TTB collected excise taxes totaling $20 billion, comprised of $11.2 billion for tobacco 

products, $8.1 billion for alcohol beverage products, and $665 million for firearms and 

ammunition. 

The investments in the Collect the Revenue activity resulted in the following performance 

highlights and accomplishments during FY 2020: 

 TTB collected $20 billion in excise taxes and other revenues from a tax base of nearly 35,000 

taxpayers in the alcohol, tobacco, firearms, and ammunitions industries. In FY 2020, TTB 

returned $380 for every dollar invested in its tax collection activities. 

 TTB’s measures of electronically filed tax returns and operational reports indicate that 

although e-filing rates trended positively in FY 2020, less than half of TTB tax submissions 

are submitted to TTB via Pay.gov, the current online system for electronic submissions. High 

rates of paper filings make compliance monitoring and fraud detection more difficult and 

costly, and have a higher environmental impact. The IT system modernization investment 

requested for FY 2022 will support system improvements that will drive increased electronic 

tax filing rates, which should result in more accurate, timely, and complete submissions as 

well as improved access to data for tax verification. 

 TTB revised its measure of voluntary compliance from large taxpayers in FY 2020 based on 

a new scoring method to better reflect risk by filing type and revenue exposure. TTB 

established a high standard for its largest taxpayers, with a targeted filing compliance rate of 

95 percent. In FY 2020, TTB achieved an overall compliance rate of 91 percent from its large 

taxpayers in meeting all tax filing requirements. Payment compliance rates remained high, at 

over 99 percent, indicating that the majority of reported liabilities are paid on time. 

Compliance rates for tax returns and operational reports were 84 percent and 83 percent, 

respectively. Although below target, these rates held constant with FY 2019, even with 

disruptions to TTB and industry operations caused by COVID-19. Although TTB analysis 

indicates that this trend does not represent a significant revenue risk, as late filings represent 

the majority of the compliance violations, non-compliance undermines the level playing 

field, which is particularly critical for the small producers who comprise the majority of TTB 

taxpayers. The FY 2022 request supports the IT system and analytics enhancements that 

would enable TTB to more efficiently detect and address these issues. 

TTB’s Protect the Public 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 the more than 106,000 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 2020: 

 TTB received approximately 183,000 label applications and 24,000 formula applications for 

new alcohol and beverage product approvals. Federal law prohibits the import or domestic 

bottling of an alcohol beverage without an approved label, making this service integral to 

U.S. businesses and economic recovery priorities. Despite increased submission volume, 

TTB achieved the targeted performance level for formula approvals, and ended the year with 

87 percent of formula applications meeting the 15‐day standard, exceeding the target of 85 

percent. This was achieved through effective monitoring and management of the application 

backlog combined with strategic workforce management to efficiently deploy staff. By 

employing similar strategies, TTB nearly achieved the 85 percent target for label approvals in 

FY 2020, ending the year at 83 percent. Performance significantly improved for both 

application types in the latter half of the fiscal year as TTB cleared backlogs, with the vast 

majority of applications processed in 10 days or less. 

 TTB received approximately 7,800 applications for a Federal permit or registration, and 

qualified approximately 6,500 new businesses, predominantly small businesses. 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. Under a two-year Agency 

Priority Goal (APG) for FY 2018 – 2019, TTB and Treasury set a performance goal 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. TTB met one of its two APG targets in FY 2019, reducing average 

approval times to 75 days. However, TTB fell short of its second target to achieve the 75-day 

service standard for 85 percent of permit applicants. In FY 2020, TTB retained this second 

prong of its priority goal and, by year-end, nearly achieved target at 84 percent. Average 

review times also decreased significantly, down to 42 days overall in FY 2020, with 

improvements across all application types. TTB attributes these gains to improved backlog 

management, which was facilitated by new permit application dashboards that display key 

metrics on the status and age of pending applications to support effective processing and 

management. 

 TTB made significant progress in reducing the error rate on initial permit, label, and formula 

applications, a critical strategy to maintaining timely service, although performance remains 

well above the targeted rate of 25 percent, at 62 percent for permit applications and 34 

percent for label and formula applications. Improvements in FY 2020 were driven by system 

enhancements and online guidance. Performance in permitting is expected to continue to 

improve following planned enhancements to the Permits Online system and completion of 

planned rulemaking to implement broader changes to TTB permit applications. At the 

FY 2022 funding level, TTB will also continue to pursue system-based validations and user 

guidance to reduce label and formula application errors. 

 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 2020, satisfaction rates increased, 

from 77 percent to 80 percent for COLAs Online users and 70 percent to 73 percent for 

Formulas Online users. TTB generally attributes these increases to reduced processing times 
and anticipates that performance will continue to improve through FY 2022 in line with 

timely service levels. Further, TTB expects that planned system improvements in FY 2022 

and regular review of survey feedback will help TTB to exceed its user satisfaction target of 

80 percent and continue to attract users to its online systems to maintain electronic filing 

rates above its target of 98 percent.