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Edmonds distiller worries tax hike will increase prices of products

"It's going to roll down to bars and restaurants. It's going to hit everybody at all levels."

EDMONDS, Wash. — Small distillers making craft vodka, whiskey, gin, and other spirits are worried a looming tax hike could have devastating impacts on their businesses.

A federal tax break is set to expire on Dec. 31. The current federal excise tax distillers pay is $2.70 on the first 100,000 proof gallons. At the end of the year, that tax could go up to $13.50.

“It's going to roll down to bars and restaurants. It's going to hit everybody at all levels,” said Kim Karrick, owner of Scratch Distillery in Edmonds.

The tax break went into effect two years ago to help small distillers. Karrick increased production and brought on a full-time employee. Now, she's worried she'll have to raise prices a few dollars a bottle or lay people off.

“Most people don't have any idea, so I think it really will surprise a lot of people,” Karrick said.

Whatever Karrick bottles in the next few weeks will avoid the tax increase.

“We are distilling every day trying to get anything and everything we can into a bottle before the end of the year,” she said.

Karrick said she hopes customers will contact their members of Congress and urge them to renew the tax cut. She said with the impeachment process playing out in the nation’s capital, it’s unlikely lawmakers will reach an agreement before the end of the year.

 

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