Craft Beverage Modernization Act (CBMA) FAQ’S

General – Refund. Once I submit a claim, how long should I expect to wait for my refund?

On February 28, 2019, CBP will start reviewing and liquidating CBMA claims, in chronological order. This means that CBP will start reviewing January 2018 entries first. Once reviewed, entries will immediately liquidate, and refunds or bills-in some cases-are issued.

General – Refund. When submitting a request to TTB for a refund for 14-16% wine where I paid the higher rate, where should I send my request for a letter from CBP, as mentioned in CSMS# 18-000708?

Pursuant to the regulation, requests may be sent to CBP. Please send requests to the Center that controls the entry. Most of the Alcohol industry aligns with the Agriculture CEE. For the Agriculture CEE, please send requests to the Agriculture Center at CEE-Agriculture@cbp.dhs.gov. Please include the entry numbers and Importer of record number with your requests.

General – Tax Rate or Tax Credit. What are the maximum quantities that an assigning entity can allocate per tax rate or credit for foreign produced alcohol?

The quantitative limits for CBMA adjusted tax rates or credits are determined per controlled group as defined by the CBMA and 26 U.S.C. 1563. For example, a controlled group may allocate to any number of importers the lower $16.00 per barrel tax rate to a maximum of 6,000,000 barrels in a given calendar year. The sum quantity of beer imported that is receiving a reduced CBMA tax rate and produced by a controlled group may not exceed 6,000,000 barrels. All quantitative limits are specified in the Craft Beverage Modernization and Tax Reform Act of 2017.

General – Tax Rate or Tax Credit. Is there guidance from CBP regarding the tax rate for wines containing more than 14% but not more than 16% alcohol by volume?

In CSMS #18-000708, CBP issued separate procedures and requirements addressing the CBMA‘s temporary changes to the tax classification of certain wines containing more than 14% but not more than 16% alcohol by volume.

General – Tax Rate or Tax Credit. How can I take new reduced tax rates and tax credits for domestically produced alcohol?

U.S. Department of Treasury, Alcohol Tax and Tobacco Tax and Trade Bureau (TTB) is responsible for the collection of tax on domestically produced alcohol products. TTB has issued public guidance and FAQs on the implementation of the Tax Cuts and Jobs Act of 2017 Craft Beverage Modernization and Tax Reform which can be found on their website.

General – Tax Rate or Tax Credit. Is it possible to qualify for reduced tax rates or tax credits without an allocation from an assigning entity?

No. Per the CBMA, reduced tax rates and tax credits must be assigned by a foreign producer/assigning entity. The sum quantity of alcohol that is receiving a reduced CBMA tax rate and produced by a single assigning entity may not exceed the quantitative limits set forth in the CBMA. All quantitative limits are specified in the Craft Beverage Modernization and Tax Reform Act of 2017.

General – Tax Rate or Tax Credit. If an entry comes in 2019, can importers take the tax credit in 2020 and beyond?

The benefit of the CBMA applies to imports of a given calendar year and can only be “taken” on the imports during that given calendar year. If the goods are imported in 2018 or 2019, CBMA was not claimed at the time of entry, and the entries have not liquidated, however, you may file a post summary correction (PSC) on unliquidated entries within the relevant timeframe (within 300 days from the date of entry and up to 15 days of the scheduled liquidation date, whichever date is earlier) regardless of whether that date falls outside of the 2018-2019 calendar year. If the entry has liquidated without the benefit of CBMA, the filer/importer may file a protest within 180 days of liquidation regardless if that date falls outside of the 2018-2019 calendar year.

General – Other. When should I use the CBMA flag?

Importers are strongly encouraged to utilize the CBMA flag at time of entry summary. Pursuant to CSMS message # 18-000511, importers will use the CBMA entry summary line level flag (CBMA flag) to identify imported alcohol for which the importer has received a CBMA allocation from a foreign producer/assigning entity. The CBMA flag may be transmitted at time of entry summary filing, or subsequently as a Post Summary Correction (PSC) for unliquidated entry summaries.

General – Other. Does the single taxpayer provision cover imports in the context of CBMA?

CBP has determined that the single taxpayer provision does not apply to foreign transactions as the taxpayer is the importer and the provision applies to producers who are taxpayers.

General – Other. Who can I contact for more information or questions?

Please direct all CBMA related inquiries to CBMA@cbp.dhs.gov.

General – Other. To be eligible for CBMA, do FTZ withdrawals need to be admitted into the FTZ in 2018 or must goods have been withdrawn from the FTZ in 2018?

To be eligible for CBMA, alcoholic beverages must be imported during calendar years 2018 and 2019. In the case of FTZ, importation occurs before the goods are admitted. Only when the goods are withdrawn for consumption can a CBMA claim be made.

General – Other. I have 200 entries in which I would like to claim CBMA. For DIS purposes, I made one spreadsheet for all 200 entries, is this allowed in DIS since the DIS subject line must indicate the entry number?

One CBMA Spreadsheet can have multiple entry numbers, as long as they pertain to one importer. You will use the entry number with the earliest import date for DIS labeling purposes.

General – Other. Will the importer be notified should a claim be denied?

The importer may receive a CBP form 29, Notice of Proposed Action indicating that CBP proposes to liquidate the claim at the higher non-CBMA rate. If CBP receives no response, the action is taken. Additionally, since entries will immediately liquidate, filers/importers may go to CBPs bulletin notice website for liquidation disposition of the CBMA entries.

General – Other. If 2018 entry summaries were filed manually and NOT through ACE, where should I submit my claim?

For non-ABI entries (paper), please submit the Assignment Certification, CBMA Spreadsheet, and CBMA Controlled Group Spreadsheet to the CBMA mailbox at CBMA@cbp.dhs.gov.

General – Other. If an Importer has two foreign beer producers, would they have 12 million barrels of beer to claim?

It is possible if both controlled groups assigned the importer full CBMA allocations. Each controlled group may allocate up to 6 million barrels at the $16.00 rate. The two producers must not be part of the same controlled group, as they would exceed the 6 million barrel quantitative limit.

Substantiating Documentation – Instructions. How does the importer make a complete CBMA claim?

In order to make a complete CBMA claim, the importer must, in addition to flagging each line for which a CBMA claim is asserted, or identifying CBMA as the protest issue, provide CBP with a complete and accurate CBMA Spreadsheet, Controlled Group Spreadsheet, and Assignment Certification. Missing, incomplete or inaccurate documents may result in the liquidation of entries at the higher non-CBMA rate and/or enforcement action. Templates for these three documents are posted on CBP.gov at https://www.cbp.gov/trade/basic-import-export/craft-beverage-modernization-tax-reform-act-2017.

Supporting documentation for non-ABI (paper) entries and paper protests not submitted via ACE should be submitted to the Entry Unit at the Port of Entry. This is a CHANGE from the 2018-2019 procedures and requirements