KOMBUCHA
- Bill Number
- H.R. 8631
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2026-04-30: Referred to the House Committee on Ways and Means.
- Last Updated
- 2026-05-13T15:54:57Z
AI-Generated Summary
H.R. 8631: KOMBUCHA Act
Purpose
To exempt low-alcohol kombucha (a fermented tea beverage) from federal excise taxes and regulations applied to alcoholic beverages like wine and beer under the Internal Revenue Code.
Key Provisions
- Definition of low-alcohol kombucha: A beverage that:
- Is fermented only by a symbiotic culture of bacteria and yeast (SCOBY).
- Contains no more than 1.25% alcohol by volume (ABV).
- Is marketed and sold as kombucha.
- Is made from fermentable sugars (e.g., sugar, malt, honey, fruit juice) and plant materials (e.g., tea, coffee).
- Exemption from wine taxes and rules: Amends Section 5042(a) to exclude qualifying kombucha from wine excise taxes and Subchapter F regulations (which cover wine production, bonding, and permits).
- Exemption from beer taxes and rules: Amends Section 5053 to exclude qualifying kombucha from beer excise taxes and Subchapter G regulations (which cover beer production, bonding, and permits).
- Regulatory oversight: Exemptions are subject to rules set by the Secretary of the Treasury (who oversees the IRS).
- Effective date: Applies to calendar quarters starting after the bill's enactment.
Significant Changes to Existing Law
- Introduces the first specific definition and full exemption for low-alcohol kombucha in the Internal Revenue Code, preventing its classification (and taxation) as wine or beer.
- Previously, kombucha with even low alcohol levels could face alcohol beverage taxes and strict production rules, despite being sold as a non-alcoholic health drink.
Potential Impacts
- Kombucha industry: Reduces production costs by eliminating excise taxes (currently up to $13.80 per gallon for low-alcohol wine or beer) and regulatory burdens like bonding requirements.
- Government agencies (IRS/Treasury): Minor loss of tax revenue; simpler enforcement through targeted regulations rather than broad alcohol rules.
- Citizens/consumers: Likely lower prices and wider availability of kombucha as a health-focused beverage.
- No apparent effects on international relations.
Main Stakeholders
- Primary: Kombucha producers and manufacturers (relieved of taxes/regulations).
- Secondary: Retailers/sellers of kombucha; IRS/Treasury Department (for tax collection and oversight); consumers seeking affordable, low-alcohol fermented drinks.
Notable Legal, Constitutional, or Political Implications
- Legal: Provides clear statutory clarity on kombucha's tax status, reducing disputes over its treatment as an "alcoholic beverage" under Chapter 53; relies on Treasury regulations for implementation details.
- Constitutional: None significant; standard congressional authority over taxation.
- Political: Supports small manufacturers and the growing health beverage market by addressing perceived "unfair taxation," as highlighted in the bill's acronym (KOMBUCHA: Keeping Our Manufacturers from Being Unfairly taxed while Championing Health Act).
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (1)
Recent Actions
- 2026-04-30: Referred to the House Committee on Ways and Means.
- 2026-04-30: Introduced in House
- 2026-04-30: Introduced in House
Bill Versions
- Keeping Our Manufacturers from Being Unfairly taxed while Championing Health Act — issued 2026-04-30 — PDF (3 pages)