LANSING, Mich. – The Senate Commerce Committee on Wednesday approved legislation sponsored by Sen. Wayne Schmidt that would help Michigan wineries by clarifying the companies’ sales and use tax industrial processing exemption.
The measures would also apply to microbreweries and micro-distilleries.
Currently, alcohol producers are granted a tax exemption on processing equipment used to produce wine for wholesale, however, there is some ambiguity as to whether that exemption also applies to wine sold at retail directly by the producer.
“Michigan’s $300 million wine industry is among the largest in the nation and provides jobs for more than 3,000 residents,” said Schmidt, R-Traverse City. “Removing this double tax burden promotes the growth of an industry that is incredibly important to the economy of our state and to thousands of hard-working families.”
Marie-Chantal Dalese of the Chateau Chantal winery and Brian Lesperance of the Fenn Valley winery testified in support of the measures before the committee.
“This important legislation will allow wineries to reinvest more into our businesses, which will help create more jobs and attract new customers. It will help promote Michigan’s economic growth as well as ensure Michigan’s wineries are in compliance with the state’s tax laws,” Dalese and Lesperance said. “We thank Senators Schmidt and Brandenburg for recognizing the need for these bills and encourage the Legislature’s support.”
There are 212 wineries in the state. Of those, only 48 offer on-site tasting rooms. Schmidt said wineries are discouraged from offering these rooms because of the uncertainty of the double tax implications. By passing his bill, Schmidt said Michigan’s wine and tourism industries would benefit as it would prevent double taxation from occurring and encourages industry growth.
Photo caption: Sen. Wayne Schmidt, R-Traverse City, and guests, Brian Lesperance of the Fenn Valley winery (center) and Marie-Chantal Dalese of the Chateau Chantal winery (right), testified before the Senate Commerce Committee in support of Senate Bills 369-70, which would help Michigan wineries by clarifying the companies’ sales and use tax industrial processing exemption.