Bubble Tax Modernization Act of 2025
Summary
The Bubble Tax Modernization Act of 2025 aims to amend the Internal Revenue Code of 1986 by removing the tax differentiation between mead and low alcohol by volume wine. This bill seeks to simplify the tax structure for these beverages. The bill defines low alcohol by volume wine as containing not more than 16 percent alcohol by volume and not more than 0.64 gram of carbon dioxide per hundred milliliters.
Expected Effects
If enacted, the primary change will be a uniform tax treatment for mead and low alcohol by volume wine. This could lead to adjustments in pricing and market dynamics for these products. The change would be effective for wine removed after December 31, 2025.
Potential Benefits
- Simplified tax code for affected beverages.
- Potential for reduced compliance costs for producers.
- May lead to more competitive pricing for consumers.
- Could encourage innovation and growth in the mead and low alcohol wine industry.
Most Benefited Areas:
Potential Disadvantages
- Potential loss of tax revenue if the new uniform rate is lower than the previous rate for some products.
- Possible shift in market share between mead and low alcohol wine producers, disadvantaging some.
- Uncertainty regarding the long-term economic impact on the industry.
Constitutional Alignment
This bill falls under the purview of Congress's power to lay and collect taxes, duties, imposts, and excises, as outlined in Article I, Section 8, Clause 1 of the US Constitution. The bill does not appear to infringe upon any specific constitutional rights or limitations. The act of modifying the tax code is a fundamental power of the legislative branch.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).