North Carolina, Pennsylvania Pass RTDs-Friendly Bills


July 5, 2024

Clark County Nevada RTD generic

The North Carolina Senate last week passed SB 527, a bill that contains a number of consumer-friendly measures including lowering the tax rate for spirits ready-to-drink cocktails (RTDs), allowing cocktails to-go and delivery of mixed beverages, and permitting holiday sales.

The bill now heads to Governor Roy Cooper for his signature.

“North Carolina spirits consumers are one step closer to enjoying increased convenience with the passage of SB 527,” Andy Deloney, Distilled Spirits Council of the United States senior vice president and head of state public policy, said in a news release. “Lowering the tax rate for spirits ready-to-drink cocktails, allowing cocktails to-go and permitting holiday sales are all measures that will benefit local hospitality businesses and the consumers they serve.

“Many states already have these market modernizations, and it’s time North Carolinians and the tourists that visit are able to enjoy the same. We urge Governor Cooper to sign this consumer- and business-friendly measure into law.”

Despite many spirits RTDs having the same or lower alcohol-by-volume (ABV) than their beer- and wine-based counterparts, they are currently taxed at a much higher rate. SB 527 defines a “pre-mixed cocktail” and sets a maximum ABV of 13%. It exempts these low-ABV products from the state’s mixed beverage tax of $20 per four liters that is paid by the on-premise “mixed beverage permit” holders.

SB 527 authorizes cocktails to-go and delivery by mixed beverage permittees or delivery service permittees. Cocktails to-go orders must be made with a food purchase and placed in tamper-evident containers. Current law does not authorize cocktails to-go as a previous, temporary cocktails to-go measure sunset in June 2021.

Since the beginning of the pandemic, 28 states and the District of Columbia have enacted laws to permanently allow cocktails to-go.

SB 527 authorizes local ABC stores to sell on New Year’s Day, July 4 and Labor Day.

Read more: Distilled Spirits Council Honors Industry Leaders

The Pennsylvania House Liquor Control Committee passed Senate Bill 688, a bill to allow low alcohol-by-volume (ABV) spirits ready-to-drink cocktails (RTDs) to be sold from certain retail outlets that already sell beer and wine products with the same or lower alcohol contents. The bill now heads to the full House for consideration.

“Allowing adult consumers to purchase their favorite spirits ready-to-drink cocktails where they already buy beer and wine just makes sense,” Deloney said. “These products contain the same amount of alcohol as products already being sold in grocery and convenience stores, so consumers shouldn’t have to make an extra trip to purchase them. We urge the House to pass SB 688 in support of Pennsylvania consumers and businesses.”

A survey showed consumers support greater access to these products, including in grocery and convenience stores, with 86% agreeing that spirits RTDs should be sold where beer and wine are available for purchase. Despite having the exact same alcohol content as beer- and wine-based RTDs, spirits RTDs are at a more than 10,000 store disadvantage in the commonwealth.

Pennsylvania is one of many states taking a closer look at this issue to ensure that producers of spirits-based RTDs are being treated fairly, recognizing that treating beverages differently based on the myth that some alcohol is “softer” than others sends a dangerous message to consumers.