Las Vegas, NV – Congresswoman Dina Titus (D-NV-1) has signed on to the first national bill supporting the growing US kombucha industry. Kombucha, the sparkling fermented tea that has disrupted the US beverage market and sparked demand for live cultured foods, has seen a long period of massive growth. As the economy recovers from the COVID-19 pandemic, the industry offers a promising path forward for small manufacturers. However, one issue hampers its growth: trace alcohol.

While the alcohol-by-volume (ABV) for kombucha averages 0.5%, it can vary slightly due to living cultures; this presents a challenge for producers, as current legislation applies excise taxes (the kind paid by breweries) to beverages with an ABV above .5%. This limit, set during Prohibition and lower than globally accepted levels (1-2% throughout Mexico, Canada, Australia and Europe), has forced small businesses to develop costly techniques to ensure that every bottle remains in compliance throughout its life cycle.

The KOMBUCHA Act, “Keeping Our Manufacturers from Being Unfairly Taxed while Championing Health Act,” would amend the Internal Revenue Code of 1986 to increase the taxable ABV threshold for kombucha from 0.5% to 1.25%, relieving a burden that has plagued the young industry since 2010. 

Congresswoman Titus joins lawmakers from California, Oregon, New York, among others, in co-sponsoring the KOMBUCHA Act, which promises to help businesses start up and expand into new regions. Introduced by Rep. Earl Blumenauer (D-OR-3) and Sen. Ron Wyden (D-OR),  it has received bipartisan support and follows a trend of tax updates in recent years relieving similar burdens on craft beverage producers, such as the CIDER Act in 2015.

FOLK Brewing Co, an advocate for the bill based at Lake Tahoe, has felt the impact of this issue. Jennie Fairchild, one of its founders and owners, says it has limited her business’s growth:

“We are extremely grateful to Rep. Titus for understanding the importance of the KOMBUCHA Act and for helping small businesses like FOLK Brewing Co to grow and expand our reach to areas like Las Vegas. Passing this law is key to our being able to make authentically brewed kombucha available to a much broader market.”

Kombucha Brewers International, the trade association representing kombucha brands throughout the world, has set up a petition for customers of FOLK Brewing Co and other local kombucha brands to urge their lawmakers to sign on in support of the bill. The petition can be viewed here.

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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