WASHINGTON, D.C. 01/14/2025 – Wine & Spirits Wholesalers of America (WSWA), today submitted a letter to House Ways and Means Chairman Jason Smith and Ranking Member Richard Neal regarding the permanent extension of key provisions of the 2017 Tax Cuts and Jobs Act (TCJA)- including the Section 199A tax deduction on qualified business income and exemptions within the estate tax code, which expire in 2025.
“The importance of Section 199A to the livelihood of family-owned businesses across the country cannot be overstated It has created jobs, supported local communities, and ensured American companies can thrive through the challenges presented by a global pandemic and the significant inflation of the last few years. Without it, many businesses would be forced to make difficult decisions about their workers, facilities, and business future,” wrote WSWA President and CEO Francis Creighton.
WSWA members, as logistics and marketing businesses, face competition not only from each other but also from large, publicly traded corporate distributors and retailers for critical resources like employees, trucking, warehouse space, and equipment. Most of America’s wine and spirits wholesalers are multi-generational, family-owned, and privately held businesses that rely on the Section 199A deduction to remain competitive. If these tax deductions expire, family-owned businesses would face a significant disadvantage, shouldering a top statutory tax rate nearly double that of multinational corporations.
“Without the 199A deduction, we simply would not have been able to compete with corporations that pay a lower tax rate. The playing field would have shifted, making it harder for businesses like ours to continue thriving and contributing to the local economy,” said WSWA Chairwoman and President of Opici Family Distributing Dina Opici. “Since 2017, this deduction has allowed businesses like ours to invest in our employees, expand our fleets, upgrade our facilities, and give back to the communities we serve. It’s not just a financial benefit; it’s a lifeline that helps ensure the sustainability and growth of businesses that have been built from the ground up over generations.”
WATCH: WSWA CHAIRWOMAN DINA OPICI ON THE IMPORTANCE OF SECTION 199A
Since the enactment of TCJA, America’s family-owned wine and spirits wholesalers across the country have invested billions into their 97,800 full-time employees, 4,175 facilities, and 1,121 separate communities. A study performed by John Dunham and Associates indicates that Section 199A enabled wine and spirits wholesalers to invest between $44 million and $54 million annually into our companies, at a total of $304-$380 million since 2017.
"What the tax savings has allowed us to do is we're constantly redoing our infrastructure," Co-CEO of Great Lakes Wine & Spirits Syd Ross told Wine-Searcher last year. "We've gone from one (warehouse) facility to four facilities. We bought Highland Park a police car, and we bought the fire department uniforms. It's not like we're taking the money and putting it out in our pockets."
In 2024, WSWA worked closely with the Main Street Coalition to take part in 5 roundtables with Members of Congress across the country and host 10 warehouse tours to better qualify the critical impact the Section 199A tax deduction has had on the industry. More than 30 Texas business leaders met with House Ways and Means Committee Member Beth Van Duyne (R-TX-24)l last October to discuss tax relief at the Republic National Distributing Company (RNDC) facility in Grand Prairie, Texas.
At today’s hearing, Representative Van Duyne entered WSWA’s comment letter into the record saying, “Last year, we heard from workers and small business owners in field hearings and round tables across the country about the necessity of renewing the 2017 Trump Tax Cuts. Policies like the Small Business Deduction in Section 199A allowed small businesses to thrive by giving them a chance to reinvest billions of dollars into their employees and companies. Today’s hearing was an important continuation of this work to support America’s working families and job creators by preventing the greatest tax hike in U.S. history.”