SENATE BILL REPORT

SB 5259

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

Title: An act relating to the tax payment and reporting requirements of small wineries.

Brief Description: Concerning the tax payment and reporting requirements of small wineries.

Sponsors: Senators Kline, Honeyford, Kohl-Welles, Carrell and Schoesler.

Committee Activity: Labor, Commerce & Consumer Protection: 1/27/11, 2/07/11 [DP-WM].

Ways & Means: 2/23/11.

SENATE COMMITTEE ON LABOR, COMMERCE & CONSUMER PROTECTION

Majority Report: Do pass and be referred to Committee on Ways & Means.

Signed by Senators Kohl-Welles, Chair; Conway, Vice Chair; Holmquist Newbry, Ranking Minority Member; King, Assistant Ranking Minority Member; Hewitt, Keiser and Kline.

Background: Wineries, wine distributors, importers, and holders of certificates of approval must submit a liter tax along with a wine tax report to the Liquor Control Board on a monthly basis. Revenue generated from the wine liter tax is distributed to the liquor revolving account, the general fund, and to cities and counties. A portion of the liter tax revenue is also disbursed quarterly to the Washington Wine Commission and to Washington State University for wine and grape research.

Summary of Bill: Wineries and wine certificate of approval holders that have a total taxable sales of wine in Washington of 6000 gallons or less during the calendar year preceding the tax due date are required to report on and pay taxes no more frequently than annually.

Effective Date: Ninety days after adjournment of session in which bill is passed.

Staff Summary of Public Testimony (Labor, Commerce & Consumer Protection): PRO: Doing monthly bookkeeping is a burden on small wineries. It will save effort to be able to do it once per year. Other states do this. Please note that the fiscal note is a one time cost.

Persons Testifying (Labor, Commerce & Consumer Protection): PRO: Paul Beveridge, John Bell, Family Wineries of Washington State.

Staff Summary of Public Testimony (Ways & Means): PRO: This bill will take monthly reporting from very small businesses and move them to an annual basis. The impact is to the liquor revolving account and not the General Fund. These small wineries are small enough that they report on an annual basis to the federal government. We believe that this is a clerical issue and not a computer issue.

Persons Testifying (Ways & Means): PRO: Senator Kline, prime sponsor; John Morgan, Family Wineries of Washington.