Hastings, NE (July 13, 2021) – Congressman Adrian Smith (R-NE-3) has joined a bipartisan group of Representatives to cosponsor the first piece of legislation in Congress to support the rapidly growing kombucha industry in Nebraska after meeting with constituent Ensign Beverage. The bill would protect kombucha with up to 1.25% alcohol by volume (ABV) from being categorized as beer in the tax code.

Since 1995, kombucha, a live, fermented tea, has rapidly grown into a $2.1 billion industry. However, it has been plagued by regulations that don’t account for this new class of beverage, which has trace amounts of alcohol that can rise slightly above the current limit, 0.5% ABV, in certain conditions but remain far below intoxicating levels.

The KOMBUCHA Act, “Keeping Our Manufacturers from Being Unfairly Taxed while Championing Health Act,” amends the Internal Revenue Code of 1986 to increase the taxable alcohol-by-volume threshold for kombucha from 0.5 percent to 1.25 percent, recognizing that kombucha is not consumed like a beer or wine, and does not have the same effects.

The bill, introduced by Rep. Earl Blumenauer (D-OR-3) and Sen. Ron Wyden (D-OR),  has received strong bipartisan support but has faced challenges finding a vehicle for its passage. Congressman Smith’s addition to the bill as the Ranking member on the House Subcommittee on Select Revenue Measures has added significant weight to the effort. 

Jessi Hoeft of Ensign Beverage in Hastings, NE. Jessi, who has been meeting with Congressman Smith on this issue for several years, says she is “happy to be a part of this industry’s growth and change. With the support of Representative Smith and the passing of this bill, we will confidently continue to grow our business and produce kombucha of the highest quality.” 

Jessi’s efforts offer a clear example of the importance of individuals in changing laws, says Hannah Crum, president of the leading trade association for kombucha, Kombucha Brewers International: “We have been working to make the KOMBUCHA Act the law of the land for four years… In addition to having the support of key legislators, our success will also depend on the voices of consumers who reach out to their representatives.”

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About Kombucha Brewers International:

Kombucha Brewers International (KBI) is a non-profit trade association that represents the commercial Kombucha category globally. KBI strives to promote, protect and enhance the overall well-being of the industry by creating an open line of communication between brewers, consumers and regulators while advancing the industry through advocacy, education, research, and modern legislation. To learn more, visit www.kombuchabrewers.org.

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