Rand Paul offers bill to offer distilleries tax breaks to produce hand sanitizer

U.S. Senator Rand Paul (R-Ky.) on Wednesday presented new legislation that would allow distillers that are temporarily producing sanitizer to void excise taxes they would typically pay if their product was meant to be ingested.

The bill highlights distillers in Kentucky and throughout the U.S. that have offered their plants as resources to increase the production of sanitizer.

“While distillers across Kentucky and the nation have quickly adapted their operations to provide a public service and support our communities and first responders during this emergency, the federal government is still stuck doing business as usual, allowing unelected bureaucrats to call the shots because they think Americans will drink their hand sanitizer,” said Paul. 

He added that the “Government should be helping, not hindering, our response to this pandemic, and my legislation ensures distillers aren’t punished for supporting the American people.”

The bill would amend the Internal Revenue Code of 1986 to exempt distilleries from some requirements in order to aid sanitizer production amid the coronavirus crisis.

Paul alleges that while the recently passed CARES Act attempted to address the issue using a provision meant to excuse distillers from the tax, the language within the act says distillers are still subject to Food and Drug Administration guidance, according to a press release.

The FDA guidance instructs distillers wanting to avoid the excise tax to denature their alcohol using chemicals to ensure it is “not fit for human consumption,” which could pose problems for machinery in distillery plants when they begin producing alcohol again.