Avalara has debuted a new compliance solution for the alcoholic beverage industry, AvaTax for Beverage Alcohol. The new product comes after Avalara bought Compli, which provides compliance services, technology and software to producers, distributors and importers of alcoholic beverages in the United States, last year.
AvaTax Beverage Alcohol provides compliance solutions for wineries, distilleries, breweries, importers and retailers. The solution locates and calculates sales and use tax plus beverage alcohol tax rates, and connects to e-commerce or accounting software already in use by customers.
As Avalara sees it, the COVID-19 pandemic accelerated trends that were already in motion prior to tasting rooms, restaurants and bars shutting down or scaling back. Many businesses in the beverage industry, as in other industries, have moved to an e-commerce model. For alcohol that is necessarily dependent on state-by-state, direct-to-consumer legislation allowing wineries — and in some states breweries, distilleries and retailers — to ship directly to customers. As alcoholic beverages are more heavily regulated than other products, the new sales channels bring new compliance issues that must be addressed.
Included in the new product are services addressing various compliance hurdles brought on by new sales models, as well as the existing needs of the alcoholic beverage industry. Some of these features are:
- Avalara Licensing for Beverage Alcohol: Businesses must properly register and maintain state beverage alcohol licenses, or risk revocation of licensure in the state, and potentially at the federal level. Licensing for Beverage Alcohol tracks registration with the federal Alcohol and Tobacco Tax and Trade Bureau, state departments of revenue and their alcohol beverage control departments .
- Avalara Product Registration for Beverage Alcohol: This module helps businesses secure the right permits in the right places and make sure every label is properly registered at the federal and state levels. Product Registration for Beverage Alcohol allows businesses to outsource interaction with regulatory entities at all levels of government.
- Avalara Returns for Beverage Alcohol: Failure to comply with reporting requirements and tax remittances can put business licensure in jeopardy. Returns for Beverage Alcohol is designed to manage the end-to-end returns process on behalf of customers.
“The beverage alcohol industry has experienced substantial shifts for several years, first via U.S. Supreme Court and individual states’ decisions and legislation allowing for direct shipping, and second through a pandemic-driven rush to sell online in order to keep the doors open,” said Jeff Carroll, general manager of beverage alcohol at Avalara, in a statement. “These sellers are getting a crash course in online commerce, including the complexity of tax compliance. With today’s announcement, Avalara now offers the only complete solution to address a growing set of compliance challenges and frustrations for this rapidly evolving industry.”
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