[Federal Register Volume 82, Number 13 (Monday, January 23, 2017)]
[Proposed Rules]
[Pages 7753-7755]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-00334]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Parts 24 and 27

[Docket No. TTB-2016-0014; Notice No. 168; Re: T.D. TTB-147]
RIN 1513-AC31


Implementation of Statutory Amendments Requiring the Modification 
of the Definition of Hard Cider

AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.

ACTION: Notice of proposed rulemaking; cross-reference to temporary 
rule.

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SUMMARY: Elsewhere in this issue of the Federal Register, by means of a 
temporary rule, the Alcohol and Tobacco Tax and Trade Bureau (TTB) 
implements changes made to the definition of ``hard cider'' in the 
Internal Revenue Code of 1986 by the Protecting Americans from Tax 
Hikes Act of 2015. The modified definition broadens the range of wines 
eligible for the hard cider tax rate. TTB is amending its regulations 
to reflect the modified definition of hard cider effective for products 
removed on or after January 1, 2017, and to set forth new labeling 
requirements to identify products to which the hard cider tax rate 
applies. The new labeling requirements include both a one-year 
transitional rule and a new labeling requirement that takes effect for 
products removed on or after January 1, 2018. The text of the 
regulations in that temporary rule published elsewhere in this issue of 
the Federal Register serves as the text of the proposed regulations.

DATES: Comments must be received on or before March 24, 2017.

ADDRESSES: Please send your comments on this document to one of the 
following addresses:
     Internet: https://www.regulations.gov (via the online 
comment form for this document as posted within Docket No. TTB-2016-
0014 at ``Regulations.gov,'' the Federal e-rulemaking portal);

[[Page 7754]]

     U.S. Mail: Director, Regulations and Rulings Division, 
Alcohol and Tobacco Tax and Trade Bureau, 1310 G Street NW., Box 12, 
Washington, DC 20005; or
     Hand delivery/courier in lieu of mail: Alcohol and Tobacco 
Tax and Trade Bureau, 1310 G Street NW., Suite 400, Washington, DC 
20005.
    See the Public Participation section of this document for specific 
instructions and requirements for submitting comments, and for 
information on how to request a public hearing.
    You may view copies of this document, the related temporary rule, 
and any comments TTB receives about this proposal at https://www.regulations.gov within Docket No. TTB-2016-0014. A link to that 
docket is posted on the TTB Web site at https://www.ttb.gov/wine/wine-rulemaking.shtml under Notice No. 168. You also may view copies of this 
document, the temporary rule, and any comments TTB receives about this 
proposal by appointment at the TTB Information Resource Center, 1310 G 
Street, and NW., Washington, DC 20005. Please call (202) 453-2270 to 
make an appointment.

FOR FURTHER INFORMATION CONTACT: Kara Fontaine, Regulations and Rulings 
Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G Street NW., 
Box 12, Washington, DC 20005; telephone (202) 453-1039, ext. 103.

SUPPLEMENTARY INFORMATION: 

Background

    On December 18, 2015, the President signed into law the 
Consolidated Appropriations Act, 2016 (Pub. L. 114-113). Division Q of 
this Act is titled the Protecting Americans from Tax Hikes Act of 2015 
(PATH Act). Section 335(a) of the PATH Act amends the Internal Revenue 
Code of 1986 (IRC) at 26 U.S.C. 5041 by modifying the definition of 
hard cider for excise tax classification purposes. Pursuant to section 
335(b) of the PATH Act, the amended definition of hard cider applies to 
such products removed on or after January 1, 2017. The PATH Act does 
not change the tax rate applicable to wine eligible for the hard cider 
tax rate; rather, it broadens the range of products to which the hard 
cider tax rate applies. Among other things, the range of products to 
which the hard cider tax rate applies will include certain sparkling 
and carbonated products and certain products that are subject to the 
requirements of the Federal Alcohol Administration Act (FAA Act).
    Elsewhere in this issue of the Federal Register, TTB is publishing 
temporary regulations making amendments to parts 24 and 27 of the TTB 
regulations (27 CFR parts 24 and 27) to implement the changes made to 
the definition of ``hard cider'' in the Internal Revenue Code of 1986 
by the PATH Act. The text of the temporary regulations serves as the 
text of these proposed regulations. The preamble to the temporary 
regulations explains the proposed regulations.

Public Participation

Comments Sought

    TTB requests comments from interested members of the public on the 
proposed changes to our regulations in 27 CFR parts 24 and 27, which 
are described in detail in the temporary rule issued in conjunction 
with this notice of proposed rulemaking and published elsewhere in this 
issue of the Federal Register. TTB is particularly interested in 
comments on the labeling provisions and any alternatives to requiring 
that ``Tax Class 5041(b)(6)'' appear on the labels of products to which 
the hard cider tax rate applies. Please provide specific information in 
support of your comments.

Submitting Comments

    You may submit comments on this proposal by using one of the 
following three methods:
     Federal e-Rulemaking Portal: You may send comments via the 
online comment form posted with this proposed rule within Docket No. 
TTB-2016-0014 on ``Regulations.gov,'' the Federal e-rulemaking portal, 
at https://www.regulations.gov. A direct link to that docket is 
available under Notice No. 168 on the TTB Web site at https://www.ttb.gov/wine/wine-rulemaking.shtml. Supplemental files may be 
attached to comments submitted via Regulations.gov. For complete 
instructions on how to use Regulations.gov, click on the sites ``Help'' 
tab.
     U.S. Mail: You may send comments via postal mail to the 
Director, Regulations and Rulings Division, Alcohol and Tobacco Tax and 
Trade Bureau, 1310 G Street NW., Box 12, Washington, DC 20005.
     Hand Delivery/Courier: You may hand-carry your comments or 
have them hand-carried to the Alcohol and Tobacco Tax and Trade Bureau, 
1310 G Street NW., Suite 400, Washington, DC 20005.
    Please submit your comments by the closing date shown above in this 
proposed rule. Your comments must reference Notice No. 168 and include 
your name and mailing address. Your comments also must be made in 
English, be legible, and be written in language acceptable for public 
disclosure. TTB does not acknowledge receipt of comments and considers 
all comments as originals.
    In your comment, please clearly state if you are commenting for 
yourself or on behalf of an association, business, or other entity. If 
you are commenting on behalf of an entity, your comment must include 
the entity's name as well as your name and position title. In your 
comment via Regulations.gov, please enter the entity's name in the 
``Organization'' blank of the online comment form. If you comment via 
postal mail or hand delivery/courier, please submit your entity's 
comment on letterhead.
    You may also write to the Administrator before the comment closing 
date to ask for a public hearing. The Administrator reserves the right 
to determine whether to hold a public hearing.

Confidentiality

    All submitted comments and attachments are part of the public 
record and subject to disclosure. Do not enclose any material in your 
comments that you consider to be confidential or inappropriate for 
public disclosure.

Public Disclosure

    TTB will post, and you may view, copies of this proposed rule, the 
related temporary rule, and any online or mailed comments received 
about this proposal within Docket No. TTB-2016-0014 on the Federal e-
rulemaking portal. A direct link to that docket is available on the TTB 
Web site at https://www.ttb.gov/wine/wine-rulemaking.shtml under Notice 
No. 168. You may also reach the relevant docket through the 
Regulations.gov search page at https://www.regulations.gov. For 
information on how to use Regulations.gov, click on the site's ``Help'' 
tab.
    All posted comments will display the commenter's name, organization 
(if any), city, and State, and, in the case of mailed comments, all 
address information, including email addresses. TTB may omit voluminous 
attachments or material that it considers unsuitable for posting.
    You may view copies of this proposed rule, the related temporary 
rule, and any electronic or mailed comments TTB receives about this 
proposal by appointment at the TTB Information Resource Center, 1310 G 
Street NW., Washington, DC 20005. You may also obtain copies for 20 
cents per 8\1/2\ x 11-inch page. Contact TTB's information specialist 
at the above address or by telephone at (202) 453-2270 to schedule

[[Page 7755]]

an appointment or to request copies of comments or other materials.

Regulatory Flexibility Act, Paperwork Reduction Act, and Executive 
Order 12866

    Since the regulatory text proposed in this notice of proposed 
rulemaking is identical to that contained in the companion temporary 
rule published elsewhere in this issue of the Federal Register, the 
analyses contained in the preamble of the temporary rule concerning the 
Regulatory Flexibility Act, the Paperwork Reduction Act, and Executive 
Order 12866 also apply to this proposed rule.

Drafting Information

    Dana Register and Kara Fontaine of the Regulations and Rulings 
Division drafted this document with the assistance of other Alcohol and 
Tobacco Tax and Trade Bureau personnel.

List of Subjects

27 CFR Part 24

    Administrative practice and procedure, Cider, Claims, Electronic 
funds transfers, Excise taxes, Exports, Food additives, Fruit juices, 
Hard Cider, Labeling, Liquors, Packaging and containers, Reporting and 
recordkeeping requirements, Research, Scientific equipment, Spices and 
flavorings, Surety bonds, Vinegar, Warehouses, Wine.

27 CFR Part 27

    Alcohol and alcoholic beverages, Beer, Cosmetics, Customs duties 
and inspections, Electronic funds transfers, Excise taxes, Imports, 
Labeling, Liquors, Packaging and containers, Reporting and 
Recordkeeping requirements, Wine.

Proposed Amendments to the Regulations

    For the reasons discussed in the preamble, TTB proposes to amend 27 
CFR chapter I, parts 24 and 27 as follows:

PART 24--WINE

0
1. The authority citation for part 24 continues to read as follows:

    Authority: 5 U.S.C. 552(a); 26 U.S.C. 5001, 5008, 5041, 5042, 
5044, 5061, 5062, 5121, 5122-5124, 5173, 5206, 5214, 5215, 5351, 
5353, 5354, 5356, 5357, 5361, 5362, 5364-5373, 5381-5388, 5391, 
5392, 5511, 5551, 5552, 5661, 5662, 5684, 6065, 6091, 6109, 6301, 
6302, 6311, 6651, 6676, 7302, 7342, 7502, 7503, 7606, 7805, 7851; 31 
U.S.C. 9301, 9303, 9304, 9306.

0
2. [The proposed amendatory instructions and the proposed regulatory 
text for part 24 are the same as the amendatory instructions and the 
amendatory regulatory text set forth in the temporary rule on this 
subject published in the Rules and Regulations section of this issue of 
the Federal Register].

PART 27--IMPORTATION OF DISTILLED SPIRITS, WINES, AND BEER

0
3. The authority citation for part 27 continues to read as follows:

    Authority: 5 U.S.C. 552(a), 19 U.S.C. 81c, 1202; 26 U.S.C. 5001, 
5007, 5008, 5010, 5041, 5051, 5054, 5061, 5121, 5122-5124, 5201, 
5205, 5207, 5232, 5273, 5301, 5313, 5382, 5555, 6109, 7805.

0
4. [The proposed amendatory instructions and the proposed regulatory 
text for part 27 are the same as the amendatory instructions and the 
amendatory regulatory text set forth in the temporary rule on this 
subject published in the Rules and Regulations section of this issue of 
the Federal Register].

    Signed: December 7, 2016.
John J. Manfreda,
Administrator.
    Approved: January 4, 2017.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade and Tariff Policy).
[FR Doc. 2017-00334 Filed 1-19-17; 8:45 am]
BILLING CODE 4810-31-P