Malternatives May Be Impacted by Proposed Federal Regulations

Malternative producers may be required to make changes in its formulation, labeling, and advertising as a result of new regulations proposed by the U.S. Alcohol and Tobacco Tax and Trade Bureau. The proposals would limit the alcohol contribution from flavors and other ingredients containing alcohol to 0.5 percent by volume. It also proposed that the majority of the alcohol in the beverage would be derived from the malt base, and includes additional regulations on labeling and advertising for the beverages.

The Treasury Department said that flavored malt beverages would be taxed as beer and regulated as malt beverages only if less than 0.5 percent of the content of the beverage is from alcohol that comes from distilled spirits rather than from a brewing process. Officials said the rapid growth of the popularity of flavored malt beverages, marketed as alternatives to beer and wine, has prompted the proposed changes. Beer and malt beverages — made through a fermentation process — are taxed and regulated differently than distilled spirits. Many flavored malt beverages get much of their taste and alcohol content from distilled spirits found in their added flavorings.

A TTB press release with a question and answer fact sheet can be seen at and more information can be found on the Federal Register site at
The government also announced that it is seeking public. Written comments must be received by June 22, 2003 in the Federal Register. You can submit comments by mail to Chief, Regulations and Procedures Division, Alcohol and Tobacco Tax and Trade Bureau, P.O. Box 50221, Washington, DC