Commodity TSUS item Still wine, grape, containing not over 14 percent alcohol: In containers holding not over 1 gallon--- 167.30 Note.--For the statutory description, see the Tariff Schedules of the United States Annotated (TSUSA-1970). U.S. trade position U.S. production supplies more than four-fifths of U.S. table wine consumption. U.S. exports of wine are small. Description and uses Labeling and advertising regulations of the U.S. Internal Revenue Service (27 CFR 4.21) set forth a general standard of identity for grape wine as "wine produced by the normal alcoholic fermentation of the juice of sound, ripe grapes (including restored or unrestored pure condensed grape must), with or without the addition, after fermentation, of pure condensed grape must, and with or without added grape brandy or alcohol, but without other addition or abstraction except as may occur in cellar treatment." "Cellar treatment" as defined by statute (26 USC 5382) refers to practices and procedures used to make an acceptable wine. These practices include certain additions of sugar and water as amelioration before, during, or after fermentation. The wines covered in this summary are designated in the Internal Revenue Service regulations as "table wine," being defined as "grape wine having an alcoholic content not in excess of 14 percent by volume." Most domestic table wines are sold under "semigeneric" names such as Burgundy, Rhine, Riesling, Claret, Chablis, Sauterne, or Chianti--nomenclature adopted from types of European wines which the U.S. wines resemble in color and general taste. In accordance with the labeling regulations of the U.S. Internal Revenue Service (27 CFR 4.24), designations of semi generic types must also bear the name of the true place of origin, e.g., "California" Burgundy, "New York" Chablis, "California" Sauterne, "California" Claret, "New York" Riesling, or "California" Chianti. The grapes used in the domestic production of the semigeneric types of wine and the type of soil on which the grapes are grown have a definite bearing on flavor and are seldom those associated with the foreign wine prototypes. February 1970 The most expensive domestic brands, accounting for about 10 percent of production, are varietal wines bearing the name of the type of grape used in their production. These include: Pinot Noir, Pinot Chardonnay, Cabernet Sauvignon, Semillon, Sylvaner, Gewurztraminer, Barbera, Riesling, and Grignolino. All of these types of grapes are associated with production of particular European wines. Varietal wines designated as Catawba, Concord, Delaware, Niagara, and Scuppernong are identified with native American grapes not associated with European wine prototypes. Wines used for cooking and deemed unfit for beverage purposes are classifiable as sauces other than thin soy sauce (item 182.46). U.S. tariff treatment The column 1 rates of duty applicable to imports (see general headnote 3 in the TSUSA-1970) are as follows: TSUS item Commodity Still wines produced from grapes, contain- Rate of duty 167.30 167.32 volume: In containers holding not over 1 gallon---- 37.5¢ per gal. The duties on these items were not reduced in the sixth round of trade negotiations concluded in 1967 under the General Agreement on Tariffs and Trade. The average ad valorem equivalent of the specific rate of duty in effect December 31, 1968, for wines in containers holding not over 1 gallon (bottled wines), item 167.30, based on dutiable imports in 1968 from countries receiving most favored nation treatment, was 9.3 percent. On wines in this group valued at $4.00 or less per gallon the ad valorem equivalent was 15.6 percent; on wines valued over $4.00 per gallon, 5.3 percent. The ad valorem equivalent of the duty on imports from countries not accorded most favored nation treatment because of Communist domination (see general headnote 3 in the TSUSA1970) was 31.3 percent. The specific rate of duty in effect December 31, 1968, for wines in containers holding over 1 gallon (bulk wines), item 167.32, based on dutiable imports in 1968, was equivalent to 17.5 percent ad valorem. Domestic and foreign wines containing not more than 14 percent of alcohol by volume are subject to a U.S. internal revenue tax of 17 cents per gallon. February 1970 U.S. consumption Annual consumption of grape table wines in the United States increased from 67.6 million gallons in 1964 to 95.8 million gallons in 1968. The increase of 41.7 percent overall was equivalent to an average annual increase of 9.1 percent, exceeding slightly the 7.6 percent annual increase in the preceding 1959-63 period. The increased use in the United States of table wines can be ascribed to the more varied beverage consumption pattern developing in the United States, as well as to a decided interest recently in Latin cuisine. Not included in the above consumption figures for still table wine is wine withdrawn from bonded wine cellars for use in the manufacture of wine vinegar or for distillation, as follows: Large fluctuations in the amount of wine withdrawn for distillation reflect in great part adjustments of wine supply to prevailing demand. Wine production as a whole varies from year to year with fluctuations in the grape crop rather than with anticipated demand, and storage facilities are not unlimited. U.S. producers and production The Census of Manufactures for 1963 reported total employment of 6,111 in 222 establishments classified in the wine and brandy industry. Twenty-six establishments, which employed 50 or more persons each, accounted for 62 percent of the industry's output. In 1968, as in most years, about 83 percent of all U.S. wine was produced in California; New York accounted for 8 percent, and another February 1970 The most expensive domestic brands, accounting for about 10 percent of production, are varietal wines bearing the name of the type of grape used in their production. These include: Pinot Noir, Pinot Chardonnay, Cabernet Sauvignon, Semillon, Sylvaner, Gewurztraminer, Barbera, Riesling, and Grignolino. All of these types of grapes are associated with production of particular European wines. Varietal wines designated as Catawba, Concord, Delaware, Niagara, and Scuppernong are identified with native American grapes not associated with European wine prototypes. Wines used for cooking and deemed unfit for beverage purposes are classifiable as sauces other than thin soy sauce (item 182.46). U.S. tariff treatment The column 1 rates of duty applicable to imports (see general headnote 3 in the TSUSA-1970) are as follows: TSUS item 167.30 167.32 Commodity Still wines produced from grapes, contain- Rate of duty In containers holding not over 1 gallon---- 37.5¢ per gal. The duties on these items were not reduced in the sixth round of trade negotiations concluded in 1967 under the General Agreement on Tariffs and Trade. The average ad valorem equivalent of the specific rate of duty in effect December 31, 1968, for wines in containers holding not over 1 gallon (bottled wines), item 167.30, based on dutiable imports in 1968 from countries receiving most favored nation treatment, was 9.3 percent. On wines in this group valued at $4.00 or less per gallon the ad valorem equivalent was 15.6 percent; on wines valued over $4.00 per gallon, 5.3 percent. The ad valorem equivalent of the duty on imports from countries not accorded most favored nation treatment because of Communist domination (see general headnote 3 in the TSUSA1970) was 31.3 percent. The specific rate of duty in effect December 31, 1968, for wines in containers holding over 1 gallon (bulk wines), item 167.32, based on dutiable imports in 1968, was equivalent to 17.5 percent ad valorem. Domestic and foreign wines containing not more than 14 percent of alcohol by volume are subject to a U.S. internal revenue tax of 17 cents per gallon. February 1970 U.S. consumption Annual consumption of grape table wines in the United States increased from 67.6 million gallons in 1964 to 95.8 million gallons in 1968. The increase of 41.7 percent overall was equivalent to an average annual increase of 9.1 percent, exceeding slightly the 7.6 percent annual increase in the preceding 1959-63 period. The increased use in the United States of table wines can be ascribed to the more varied beverage consumption pattern developing in the United States, as well as to a decided interest recently in Latin cuisine. Not included in the above consumption figures for still table wine is wine withdrawn from bonded wine cellars for use in the manufacture of wine vinegar or for distillation, as follows: Large fluctuations in the amount of wine withdrawn for distillation reflect in great part adjustments of wine supply to prevailing demand. Wine production as a whole varies from year to year with fluctuations in the grape crop rather than with anticipated demand, and storage facilities are not unlimited. U.S. producers and production The Census of Manufactures for 1963 reported total employment of 6,111 in 222 establishments classified in the wine and brandy industry. Twenty-six establishments, which employed 50 or more persons each, accounted for 62 percent of the industry's output. In 1968, as in most years, about 83 percent of all U.S. wine was produced in California; New York accounted for 8 percent, and another February 1970 |