Tag Archives: hospitality

ABC Retreats from Ban on ‘Infusion’ Mixed Drinks

The Tennessee Alcoholic Beverage Commission’s executive director retreated Monday from plans to begin enforcing on July 1 a law he had interpreted as prohibiting restaurants from soaking fruits and juices in alcoholic beverages to create “infused” mixed drinks.
Critics had disputed the legal interpretation and said the prohibition would hurt the business of bars and restaurants that cater to customers with specialty drinks.
In an emailed statement, Keith Bell said the TABC still believes “the process of manufacturing infused alcoholic beverages, not for immediate consumption” by those holding only a liquor-by-the-drink license is a violation of a 2006 law and ABC rules.
“The TABC nevertheless determined it to be in the public interest that the regulatory enforcement of this prohibition be indefinitely suspended,” Bell said.
The retreat came after a Monday morning meeting between Bell and representatives of groups who disagreed with his interpretation of the 2006 law, including the Tennessee Hospitality Association and the Nashville Convention and Visitors Bureau.
“There was a full and frank discussion of the matter and what was intended and what was not” by the 2006 law, said Dan Haskell, general counsel and lobbyist for the Tennessee Hospitality Association, which represents restaurants and motels.
With enforcement of the ban on infused drinks suspended, Haskell said he now anticipates further discussion on whether the ABC needs to change its rules or the Legislature needs to clarify the law in the 2014 session.
The law in question dealt with distilleries, effectively allowing them to sell products they make on premises that amount to a pre-mixed drink — Jack Daniels Lemonade or Jack Citrus, for example, produced by the whiskey distillery in Lynchburg, Tenn.
Bell decided earlier that the language of the law prohibits anyone but distilleries from mixing fruits and juices with alcohol if they are then stored and not consumed immediately. Such storage could raise health concerns, he said.
“I think calmer heads will prevail,” said Haskell, contending the the state Department of Health, which inspects restaurants, would have raised the issue if there were any health concerns. Connoisseurs believe some period of time is needed for the “flavors to marry up,” he said.

Hotel-Motel Tax Revision Debate: An Increase or Closing a Loophole?

The state Senate’s Tax Subcommittee held hearings this week on a proposal to amend Tennessee’s hotel-motel tax law so that the companies take book reservations would be taxed on the fees they collect. A similar proposal failed last legislative session, but is returning under sponsorship of Sen. Doug Overbey and Rep. Art Swann, both Maryville Republicans who contend the measure basically closes a loophole and makes things fair. Critics say it’s a tax increase.
From the Nashville Business Journal report:
Hospitality officials are seeking to amend a hotel tax law and require online travel companies to pay more in taxes, a measure that would add more than $1 million to annual tax revenue.
The Tennessee Hospitality Association argues that online travel companies (OTCs) have a competitive advantage because they pay taxes on a discounted room rate rather than the retail rate.
Following a dismissal of a class-action case in U.S. district court filed by Goodlettsville against Priceline.com in February, the association is seeking to, as they see it, level the playing field by changing the language in the state law.
“It’s extremely unfair,” Greg Adkins, CEO of the association, said Tuesday at Tennessee’s Tax Subcommittee of Senate Finance Ways and Means Committee.
“The OTCs get off 20 percent cheaper than do brick and mortar hotels who actual employ the folks in Tennessee. Marriot.com does the same service, has the same marketing costs.” Officials representing the online travel companies said amending the tax language would be adding a new tax to e-commerce businesses.