Eight years after Massachusetts passed an unworkable and overly-restrictive direct shipping bill, and four years since the same law was ruled unconstitutional by a federal court, Bay State legislators finally passed a workable direct wine shipping law that will allow out-of-state and in-state wineries to ship wine directly to state residents. The new law was included in the 2014 budget bill (see page 257), and was signed by Governor Deval Patrick this morning. Set to go into effect on January 1, 2015, the new wine shipping law will make both wineries and Massachusetts wine lovers overjoyed.
Massachusetts is ranked among the most important states that still had not passed winery direct shipping law. Massachusetts is particularly important given the size of its population and its residents’ love of wine. Only four states have higher per capita consumption rates for wine than Massachusetts.
The new direct shipping law, passed as part of the 2015 fiscal year budget, provides the following conditions for shippers:
- Only bonded wineries may apply for a direct shipping permit
- Direct Shipping License Fee: $300/winery (separate permits required for each “affiliate, franchise or subsidiary”)
- Direct Shipping License Annual Renewal Fee: $150
- Shipments limited to twelve 9-liter cases per purchaser in a calendar year
- Reports to the state must be remitted annually
- Excise Taxes must be remitted on each sale
Over the next six months, the Massachusetts Alcohol Beverage Control Commission will be responsible for creating and making available license applications for direct shippers. We will report here on those developments as well as any others that impact direct shippers.
In calendar year 2013, ShipCompliant generated over 200,000 reports (sales and use tax, excise tax, direct shipping reports, wholesale gallonage reports, markup tax reports) for our clients. These reports generated over 700,000 pages of paper that were printed and mailed across the country (with paper checks as well) to the various state agencies. On top of that, suppliers generated over 100,000 pages of paper from product registration packets. In 2014 we’re likely to exceed 1 million pages of paper generated by the software.
We introduced Product Registration Online (PRO) three years ago to create public-private partnerships with state agencies for electronic submission and review of registrations for alcohol beverage products. PRO is in place in 10 states right now, with many more on the way, and it’s changing the way that suppliers bring products to market. It’s also eliminating incredible amounts of paper, postage, and headaches.
Not only are paper mailings extremely wasteful, but they’re also inefficient, slow, and not visible, both for the suppliers and the state agencies. One state agency told us that it costs them $35 on average to process each paper check that comes in! Further, a compliance consultant that I spoke with recently said that nine out of ten “notices” that they get from the state agencies are disputes about when and whether the report and check were actually mailed and received. Countless hours of back and forth are spent just trying to prove whether the mailings went out on time. The only way that suppliers know that the state received the report successfully is by monitoring that the checks actually got cashed, a process that can often take several months.
We’re on a mission to eliminate paper from this industry.
Just last month, we introduced AutoFile, a capability that allows suppliers to put their reports on cruise control. We keep track of whether you’re filing monthly, quarterly, semi-annually or annually with each agency, and make sure your reports get filed on time and accurately, every time. Everything is fully visible and accessible electronically any time you need it, and fully reconciled with your accounting system. We’re creating integrations with 25 different agencies right now to establish automated connections for report remittance. AutoFile will change the way we think about reporting. No longer a task, it just happens.
PS – If you’re a state agency that is looking to automate your paper processes and want to learn more about PRO or AutoFile, please contact us.
To our valued customers:
The US beverage alcohol industry has it tough. It is one of the most regulated industries in the United States, as well as one of the most fragmented. Our industry is full of thousands of small businesses and startups; Entrepreneurs following their passion and seeking to achieve their dream of building a business as a winery, brewery, distillery or importer.
Today, I’m proud to announce a major milestone in our effort to eliminate the complexity and cost of compliance for beverage alcohol companies: AutoFile – The first fully automated filing and payment solution for regulatory reporting.
No longer will you have to print paper, cut checks, or log into online filing systems. All of your state sales tax, excise tax, direct shipping and wholesale gallonage reports are automatically filed through AutoFile, complete with payment.
AutoFile has many benefits over reporting by hand, or outsourcing:
Simple funding: State payments are made out of an account of your choosing. No painful escrow accounts to manage, or reconciliation to deal with. It’s all under your own accounts!
Total control: Anytime, anywhere, view your compliance activity, place filings on hold, review past activity. Just like online banking you can view everything submitted on your behalf, in real time.
Future proof: If a state regulatory system changes its forms, procedures or methods, rest easy, it’s our problem now, not yours.
Guaranteed: All regulatory filings will be sent on time and accurately, guaranteed.
I encourage you to try it today, using our special free trial offer:
Your first month of reporting is on us, plus we’ll waive your setup fees.
Customers: Click here to start your free trial!
Non-customers: Choose an edition of ShipCompliant right for you.
We are grateful to our many clients that assisted in creating a solution that will help our industry grow further and faster.
By now, you have probably heard about an encryption flaw called the Heartbleed bug. This bug affected web applications using a particular version of OpenSSL, a protocol designed to provide security for information transmitted over the internet. A widely-used version of OpenSSL was vulnerable to an issue in which sensitive information could potentially be exposed to a malicious hacker.
ShipCompliant services were not exposed to this vulnerability because we do not use OpenSSL.
ShipCompliant takes security, reliability and durability of your data very seriously. We follow a multi-tiered proactive approach to ensure we use the most powerful security tools and controls available so that all your sensitive information is protected. For more information on our security and privacy policies, please see our Privacy Overview page.
If you have any questions or concerns surrounding this issue, please contact us directly by emailing ShipCompliant Client Services, or by calling (303) 996-2356.
Product renewals for 2014 in South Dakota can now be done online. South Dakota now joins Arkansas as one of the most recent states to institute on-line product registrations, continuing the trend toward digital product registration, away from the realm of pulp and fiber and into the digital space.
Suppliers of wine, spirits and beer to South Dakota can complete their product registration renewals for 2014 via South Dakota’s new on-line product registration portal. Paper-based product registration is still an option – forms, fees and instructions for paper registration are available on South Dakota’s Special Tax Division website.
HOW SOUTH DAKOTA’S ON-LINE PRODUCT REGISTRATION WORKS
To utilize the new South Dakota on-line product registration portal, suppliers will need their 4-digit “BR License Number” (provided in a recent communication from the state) as well as an email address. Upon logging in, suppliers will see a list of all currently registered products associated with their BR License Number. Suppliers need merely click the box next to the product they would like to renew for distribution in 2014. Should suppliers find that they would like to edit any details of their products (i.e. to add a COLA # or edit the label description), it is possible to easily edit details of any product. All renewals are preliminarily approved upon submission. State fees for on-line registration of wine products is $30 for an initial label of a brand and $22.50 for subsequent labels under the same brand. The fee for on-line registration of beer is $30 per label, and for spirits $55 per label. Payment may be made by credit card or check.
South Dakota’s new on-line product registration will allow suppliers to more quickly register new products, renew, and edit products currently licensed and in distribution in the state.
Anyone with any questions, please leave a comment here, or contact Tonna Finch at the SD Department of Revenue by email, or by phone at 605-773-5397.
Update 10/22/2013: FedEx will halt shipments to North Dakota effective immediately. Official statement from FedEx below.
This communication is to confirm that FedEx Express, FedEx Ground and FedEx Home Delivery will cease transporting alcoholic beverages destined to an address in North Dakota effective immediately. FedEx has been unable to arrive at a solution that would allow compliance with the new law while protecting our customers’ shipping experience.
Despite their previous notices to wineries that FedEx will stop shipping to North Dakota consumers effective 11/1, FedEx will continue to ship while they are in discussions with state officials on the new requirements. Official statement from FedEx below:
“As of today, October 17th, 2013 FedEx and officials from the State of North Dakota are in continuing discussions about keeping the state open for shipments by licensed DTC shippers. We have been informed, that for the time being, those holding the required permits will be allowed to continue to process shipments via FedEx into the state past the previously announced stop date of November 1, 2013.”