South Carolina distillers are asking politicians for more aid as the pandemic continues to ravage the state’s economy.
In a July 22 letter sent to the South Carolina congressional delegation, the South Carolina Craft Distillers Guild, along with the Distilled Spirits Council, asked lawmakers to lend additional support through tax breaks and more. The press release announcing the move explains that the nation’s distillery industry is facing an uncertain future, citing a survey that details two-thirds of responding craft distillers don’t believe they will be able to sustain for more than six months.
“Absent additional relief, some distilleries soon may be faced with the tough decision to permanently close their doors, thus also impacting their farmer suppliers and others throughout the hospitality and tourism industries,” the two organizations’ leaders say in the release.
The letter asks for five main components to be included in any future economic relief packages — federal excise tax relief, deferment of those taxes, suspension of tariffs on distilled spirits, support for the RESTAURANTS Act, and replenishing funding for the Paycheck Protection Program and the economic injury disaster loan program.
John and Venetia Sharpe, the owners of Cayce’s Southern Essence Distilling were not familiar with the letter or its asks, but say they hope support comes for small distilleries like theirs.
The letter asks for the temporarily lowered federal excise tax to be made permanent, which Venetia says would be a boon for them. However, she says if a distiller is selling alcohol she isn’t sure a suspension of collections should take place.
Throughout the pandemic the Sharpes have converted some of their mom-and-pop distillery’s liquor creating efforts to make hand sanitizer. They say that and slower business overall has been a drain on them, explaining they may earn $120 per gallon of drinking liquor, and only $40 on a gallon of hand sanitizer.
And while early on they filled a niche with their sanitizer creation, that’s changed as more and more places are selling it, they explain.
“Tom, Dick and Harry has decided they want to cash in on hand sanitizer,” John Sharpe says.
Meanwhile, they mention that the PPP federal program wasn’t helpful for them as their business is so small that they didn’t qualify.
The Columbia area’s distilleries have had a rough go, with Crouch Distilling closing in June and Copper Horse Distillery prior to that. John Sharpe says they are confident Southern Essence will be able to stay open through the pandemic.
The tariffs mentioned in the letter have been a particular headache throughout the hospitality industry. Prior to the pandemic, restaurant players told Free Times that the tariffs could cause customers’ wine prices to double and, potentially, cause a ripple effect where servers earn less, independent restaurants close and European winemakers move sales to other countries.
Per the press release, the state’s distilling industry supports more than 20,000 jobs and had over $1.6 billion in economic activity in 2018.