State Revenue/Tax Loss

Indiana’s wine, spirits and beer distributors function as an extension of the Indiana Department of Revenue. Indiana distributors pay over $40 million in state excise taxes annually and deliver products only to retailers who hold valid permits and are in good standing on their state taxes. In addition, purchases of wine and spirits across state borders, including by direct-to-consumer shipments, result in the loss of excise tax collections in the purchaser’s home state.

Distributors provide an efficient and accountable process for collecting state taxes in excess of $200 million levied on alcohol products. They have the ability to monitor the sale of a product from the time it leaves the manufacturer to the time it arrives at the retailer, which makes distributors the best equipped for collecting state taxes. Additionally, the distributors ensure that sales and property taxes are paid by retailers, because distributors are not allowed to ship alcohol to a retailer whose license has been suspended for not paying sales or property taxes. Like Indiana, many states find it much easier to collect taxes from a limited number of distributors than the thousands of retail establishments selling alcohol.

To learn more about federal issues involving U.S. alcohol laws, visit the Wine and Spirits Wholesalers of America Web site.