An Act Regarding the Taxation of Flavored Malt Beverages
Maine Legislature, Session 128, LD 0794
Committee Amendment CA_A_H472 (House)
Amends: 28-A MRSA §2

COMMITTEE AMENDMENT "A " to H.P. 574, L.D. 794, Bill, "An Act 
Regarding the Taxation of Flavored Malt Beverages" 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'Sec. 1. 28-A MRSA §2, sub-§16-A, as amended by PL 2011, c. 629, §4, is 
further amended to read: 
16-A. Low-alcohol spirits product. "Low-alcohol spirits product" means a product 
containing spirits that has an alcohol content of 8% or less by volume. Beginning July 1, 
2019, "low-alcohol spirits product" does not mean a flavoring, such as an extract or 
concentrate, added to a malt beverage or wine that: 
A. May or may not contain alcohol; 
B. Is not intended to be consumed alone as a beverage or a food product but serves 
as a flavor enhancement to a beverage or a food product; and 
C. Is not, prior to being added to a malt beverage or wine, subject to excise tax under 
chapter 65. 
Sec. 2. 28-A MRSA §2, sub-§31, as amended by PL 1999, c. 535, §2, is further 
amended to read: 
31. Spirits. "Spirits" means any liquor produced by distillation or, if produced by 
any other process, strengthened or fortified by the addition of distilled spirits of any kind. 
"Spirits" does not include low-alcohol spirits products or fortified wine. Beginning July 
1, 2019, "spirits" does not mean an additive or flavoring, such as an extract or 
concentrate, that: 
A. Contains alcohol; 
B. Is not intended to be consumed alone as a beverage or a food product but serves 
as a flavor enhancement to a beverage or a food product; and 
C. Is not subject to excise tax under chapter 65. 
COMMITTEE AMENDMENT 
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COMMITIEE AMENDMENT ·A" to H.P. 574, L.D. 794 
Sec. 3. Classification of certain malt-based or wine-based products for 
tax purposes; intent. 
The Department of Administrative and Financial Services, 
Bureau of Alcoholic Beverages and Lottery Operations may not impose the tax described 
under the Maine Revised Statutes, Title 28-A, section 1652, subsection 1-A or the tax 
described under Title 28-A, section 1365 on any malt liquor-based or wine-based product 
not previously listed by the bureau as of June 1, 2017 or subject to a tax under Title 28-A, 
section 1652, subsection 1-A or section 1365 based on the fact that a flavoring, extract or 
concentrate has been added to the product that: 
1. May or may not contain alcohol; 
2. Is not intended to be consumed alone as a beverage or a food product but serves as 
a flavor enhancement to a beverage or a food product; and 
3. Is not, prior to being added to a malt beverage or wine, subject to excise tax under 
chapter 65. 
This section is not intended to affect the application of the tax described under Title 28-A, 
section 1652, subsection 1-A or the tax described under Title 28-A, section 1365 to any 
malt liquor-based or wine-based product described in this section that was listed with the 
bureau prior to June 1, 2017.' 
SUMMARY 
This amendment replaces the bill. 
The amendment clarifies the definition of 
"low-alcohol spirits product" and the definition of "spirits" to exclude additives and 
flavorings, such as extracts and concentrates, that may contain alcohol but are not 
intended to be consumed alone but serve as a flavor enhancement to food products or 
beverages. This amendment also specifies that the changes made by this legislation are 
not intended to affect the taxation of such products prior to July 1, 2019. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Net Cost (Savings) 
General Fund 
Revenue 
General Fund 
Fiscal Detail and Notes 
Revised: 06/07 /17 frac. 
LD794 
LR 1674(02) 
An Act Regarding the Taxation of Flavored Malt Beverages 
Fiscal Note for Bill as Amended by Committee Amendment ·~· [ H- lf 7 J) 
Committee: Veterans and Legal Affairs 
Fiscal Note Required: Yes 
Fiscal Note 
FY 2017-18 
FY 2018-19 
$0 
$0 
$0 
$0 
Projections 
FY 2019-20 
Projections 
FY 2020-21 
$1,686,475 
$1,686,475 
($1,686,475) 
($1,686,475) 
Under cunent statute, manufacturers of low-alcohol spirits products are taxed at a rate of $1.24 per gallon and in-
state manufacturers oflow-alcohol spirits products are taxed an additional rate of $0.30 per gallon for a combined tax 
rate of $1.54 per gallon. This bill clarifies that food flavorings or similar products with an alcohol content that are 
added to malt liquor products solely to impart flavor during the production process do not cause these products to be 
classified as low-alcohol spirits products. The State has been taxing these products at the higher combined rate of 
$1.54 per gallon and will now tax them at the lower $0.35 per gallon rate applied to malt liquor products. This will 
reduce General Fund revenue collected by the Bureau of Alcoholic Beverages and Lottery Operations by an 
estimated $1,686,475 starting in fiscal year 2019-20. 
LR1674(02) - Fiscal Note - Page 1 of 1