LRB-1465/1
ARG&KRP:wlj
2017 - 2018 LEGISLATURE
March 2, 2017 - Introduced by Representatives Kolste, Anderson, Sargent, E.
Brooks
, Thiesfeldt, C. Taylor, Pope, Subeck, Fields, Berceau, Spreitzer,
Considine, Bowen, Sinicki and Wachs, cosponsored by Senators Carpenter
and L. Taylor. Referred to Committee on State Affairs.
AB121,1,4 1An Act to renumber 125.68 (11) (a); to renumber and amend 125.02 (8) and
2139.01 (3); to amend 125.68 (8) (a) 3. and 139.03 (2m); and to create 125.02
3(8) (b), 125.68 (11) (a) 2m., 125.68 (14) and 139.01 (3) (b) of the statutes;
4relating to: the manufacture, sale, and taxation of powdered alcohol.
Analysis by the Legislative Reference Bureau
This bill makes changes to treat powdered alcohol as an intoxicating liquor,
which as currently defined includes beverages in the form of wine and distilled
spirits.
Current law generally prohibits a person from manufacturing, distributing, or
selling alcohol beverages, including intoxicating liquor, without the appropriate
license or permit. Current law imposes numerous requirements related to the
manufacture and sale of intoxicating liquor in this state. Current law also imposes
an occupational tax on intoxicating liquor manufactured in or brought into this state.
This bill modifies the definition of “intoxicating liquor” to include, with limited
exceptions, any substance that is sold in powder or crystalline form, that contains
more than 0.4 percent alcohol by weight, and that is fit for human consumption either
in its powder or crystalline form or after it is added to food or mixed with water or
another liquid (powdered alcohol). As a result, under the bill, powdered alcohol may
be sold to consumers only by licensed retailers, may be manufactured in this state
only by persons holding a manufacturer's permit issued by the Department of
Revenue, may be distributed in this state only by persons holding a wholesaler's
permit issued by DOR, and may be shipped from another state into this state only

by persons who are the product's primary source of supply and hold an out-of-state
shipper's permit issued by DOR. The bill includes exceptions for powdered alcohol
used for certain purposes, including powdered alcohol used by hospitals or for
scientific research or other medicinal, pharmaceutical, industrial, or nonbeverage
purposes.
The bill also imposes the same occupational tax on powdered alcohol that
applies to other forms of intoxicating liquor. For powdered alcohol, this tax is
calculated on the volume of the product that results after it has been mixed according
to the package instructions.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB121,1 1Section 1. 125.02 (8) of the statutes is renumbered 125.02 (8) (intro.) and
2amended to read:
AB121,2,33 125.02 (8) (intro.) “Intoxicating liquor" means all any of the following:
AB121,2,7 4(a) All ardent, spirituous, distilled or vinous liquors, liquids or compounds,
5whether medicated, proprietary, patented or not, and by whatever name called,
6containing 0.5 percent or more of alcohol by volume, which are beverages, but does
7not include “fermented malt beverages".
AB121,2 8Section 2. 125.02 (8) (b) of the statutes is created to read:
AB121,2,139 125.02 (8) (b) Any substance that is sold in powder or crystalline form, that
10contains more than 0.4 percent alcohol by weight, and that is fit for human
11consumption either in its powder or crystalline form or after it is added to food or
12mixed with water or another liquid, unless the substance is used as described in 27
13CFR 1.60
to 1.62 or meets the criteria under s. 125.68 (11) (a).
AB121,3 14Section 3. 125.68 (8) (a) 3. of the statutes is amended to read:
AB121,3,3
1125.68 (8) (a) 3. Possessing diluted intoxicating liquor, other than diluted
2intoxicating liquor described in s. 125.02 (8) (b),
or refilled original containers on any
3premises covered by a “Class A" or “Class C" license or “Class B" license or permit.
AB121,4 4Section 4. 125.68 (11) (a) of the statutes is renumbered 125.68 (11) (a) 1m.
AB121,5 5Section 5. 125.68 (11) (a) 2m. of the statutes is created to read:
AB121,3,96 125.68 (11) (a) 2m. For purposes of this paragraph, the fact that a product is
7sold in powder or crystalline form does not, by itself, render the product unfit for
8beverage purposes if the product can readily be mixed with water or another liquid
9to form a beverage.
AB121,6 10Section 6. 125.68 (14) of the statutes is created to read:
AB121,3,1211 125.68 (14) Intoxicating liquor in the form of powdered alcohol. With
12respect to intoxicating liquor described in s. 125.02 (8) (b), all of the following apply:
AB121,3,1613 (a) In any provision of this chapter referring to the volume of this intoxicating
14liquor, the applicable volume shall be the volume resulting after mixing the
15intoxicating liquor described in s. 125.02 (8) (b) according to the package
16instructions.
AB121,3,2117 (b) In any provision of this chapter authorizing a licensee or permittee to sell
18intoxicating liquor by the glass or authorizing consumption of intoxicating liquor on
19the premises where sold, the licensee or permittee shall prepare the intoxicating
20liquor described in s. 125.02 (8) (b) according to the package instructions before
21serving it to the customer.
AB121,7 22Section 7. 139.01 (3) of the statutes is renumbered 139.01 (3) (intro.) and
23amended to read:
AB121,3,2424 139.01 (3) (intro.) “Intoxicating liquors" includes all of the following:
AB121,4,5
1(a) All ardent, spirituous, distilled or vinous liquors, liquids, or compounds,
2whether medicated, proprietary, patented, or not, and by whatever name called,
3containing one-half of one percent or more of alcohol by volume, which are fit for use
4for beverage purposes, but does not include fermented malt beverages, as defined in
5s. 125.02.
AB121,8 6Section 8. 139.01 (3) (b) of the statutes is created to read:
AB121,4,117 139.01 (3) (b) Any substance that is sold in powder or crystalline form, that
8contains more than 0.4 percent alcohol by weight, and that is fit for human
9consumption either in its powder or crystalline form or after it is added to food or
10mixed with water or another liquid, unless the substance is used as described in 27
11CFR 1.60
to 1.62 or meets the criteria under s. 125.68 (11) (a).
AB121,9 12Section 9. 139.03 (2m) of the statutes is amended to read:
AB121,4,2013 139.03 (2m) The rate of that tax is 85.86 cents per liter on intoxicating liquor,
14except wine containing not in excess of 21 percent of alcohol by volume, containing
150.5 percent or more of alcohol by volume. The department of revenue may, by rule,
16set the amount of the taxes imposed under this section for various sizes of containers
17if the amounts set are in the same proportion to the size of the containers as the rate
18per liter under this subsection. With respect to intoxicating liquor described in s.
19139.01 (3) (b), the volume of the intoxicating liquor shall be the volume resulting after
20mixing the intoxicating liquor according to the package instructions.
AB121,10 21Section 10. Effective date.
AB121,4,2322 (1) This act takes effect on first day of the 3rd month beginning after
23publication.
AB121,4,2424 (End)
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