Senator Pledges to Raise Taxes on Wine, Ban Health Messages

Dana Nigro
Posted: February 23, 1999

Senator Strom Thurmond, a South Carolina Republican, has introduced legislation to ban "health messages" on wine bottle labels and dramatically raise taxes on wine. The move comes in response to the Bureau of Alcohol, Tobacco and Firearms' recent decision to approve two new labels that encourage consumers to learn more about the potential health benefits of drinking wine.

On Feb. 22, Thurmond introduced three bills in the U.S. Senate: S431 would transfer authority over alcohol labeling from the Treasury Department to the Food and Drug Administration, one of the more anti-alcohol agencies in the federal bureaucracy. S432 would hike federal taxes and create a trust fund for research into alcohol-related problems. And S433 would prohibit the use of the two new bottle labels, as well as any other additional references to wine's health benefits.

Thurmond wants to roll back the BATF's approval of the new labels because he believes the decision was "irresponsible and constitutes poor public policy, and he thought it was time for the legislative branch to take the lead," said the senator's press secretary, John DeCrosta. "Through its actions, the wine industry has brought increased scrutiny to itself. We have just begun to look into the industry and how it conducts business."

The trust fund bill proposes to raise federal excise taxes on wine to 21 cents per ounce of pure alcohol -- the same tax as on distilled spirits. Wine is currently taxed at between 7 and 11 cents an ounce, depending on its alcohol content. The bill would leave in place the existing tax credits for small domestic wineries and the exemption for home winemaking for personal use.

The money raised from the tax would be used to support programs for the prevention and treatment of alcoholism and research into health problems that have been linked to alcohol use, such as breast cancer and hypertension. The funds would be appropriated by the National Institute of Alcohol Abuse and Alcoholism and the Substance Abuse and Mental Health Services Administration.

Thurmond, whose daughter was killed in a car accident caused by a drunk driver, held up approval of the new labels for nearly a year, partly by threatening to strip the BATF of its authority to regulate the wine industry. He was also behind the 1988 legislation that requires the current health warnings on wine bottles; these are not affected by the BATF's decision.

The new voluntary labels do not contain outright health claims. One written by the Wine Institute, a San Francisco-based trade organization, reads, "To learn the health effects of wine consumption, send for the Federal Government's 'Dietary Guidelines for Americans,'" followed by the mailing and Internet addresses. The dietary guidelines published by the departments of Agriculture and Health and Human Services indicate that moderate alcohol consumption could lower the risk of coronary heart disease in some individuals, but also refer to the drawbacks of drinking.

A second voluntary label, designed by the Coalition for Truth and Balance, an ad hoc group of 12 American wineries, reads: "The proud people who made this wine encourage you to consult your family doctor about the health effects of wine consumption."

The Wine Institute has pledged to fight the proposed legislation.

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