The US Treasury Department has said it is seeking public comment on plans to change the tax and regulation structure with regard to “malternatives”, ready-to-drink (RTD) flavoured low-alcohol drinks.
The Treasury Department announced yesterday that it planned to tax malternatives as beer only if less than 0.5% the drink’s content comes from distilled spirits rather than from malt alcohol.
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Officials from the department said that the growth in these drinks had prompted the changes. At present, malternatives are taxed and regulated differently from the distilled spirits brands which they are often named after. However, many of the brands derive much of their taste from distilled spirit found in their added flavourings.
The global drinks force, Diageo, whose Smirnoff Ice brand is one of the products which would be affected by the changes, said the proposed regulations provide for a public comment period of 90 days and it intends to use the 90-day comment period to provide input on the changes.
Final changes to the regulations are not expected to be ratified for some time.
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