Tax law: the Customs and Monopolies Agency will give permission to dealcoholize wine

Latest news for the wine supply chain is about the especially delicate issue of wine dealcoholization, as well as the broader alcoholic beverages supply chain, as provided in the “Draft Legislative Decree containing a revision of the provisions on excise duties”, approved recently by the Council of Ministers. The Government website states that regarding the sale of alcoholic products, “a significant simplification has been provided for retail alcohol sale establishments (for instance, bars) for which reports to the Customs and Monopolies Agency (ADM) will be absorbed by the start of sales activities communication (foreseen) of subject alcoholic products, to be presented to the Central Business Office”.
Issuing a license “will be required only for certain types of storage of alcoholic products and only above pre-established minimum volumes”. The supply chain, however, is probably looking more carefully at the new article “33-ter”, as AGEEI, the Press Agency on Energy and Infrastructure reported, which concerns the chapter, “Dealcoholization of wine”.
According to the provisions in the text, paragraph 1 states that “the Customs and Monopolies Agency may authorize wine producers operating under a tax warehouse, to carry out treatments on wine aimed exclusively at reducing its alcoholic strength. Authorization will be granted by using the conditions established in the decree, referred to in paragraph 4, and provided that the annual quantity of ethyl alcohol, believed to be obtainable following the aforementioned treatments, is not higher than 50 hectoliters of anhydrous alcohol”. Paragraph 2 specifies that “the ethyl alcohol obtained following the processes referred to in paragraph 1 is subject to excise duty”. Moreover, “in the warehouses in which the subject is authorized to carry out the treatments referred to in paragraph 1, the ethyl alcohol obtained following the same treatments is to be collected in a container, sealed by the Customs and Monopolies Agency, placed in direct and stable communication with the establishments in which the treatments take place. In those same warehouses, suitable equipment is to be provided to determine the quantities of wine intended to undergo the treatments referred to in paragraph 1, and the direct ascertainment of the ethyl alcohol obtained”.
Finally, paragraph 4 provides that “by decree of the Minister of Economy and Finance, the implementation methods of the provisions in this article are to be established especially regarding the conditions in which to issue the authorization to carry out the treatments referred to in paragraph 1, and to the methods of treatments and those of accounting for the ethyl alcohol obtained from the wine”. The production of dealcoholized wine is a delicate, and highly debated issue, which the Italian wine supply chain is studying carefully. Further, apart from the new regulations on possible excise duties of ethyl alcohol, it still has to be regulated under various production aspects (as so many other European countries have done, ed.). We must also take into account that if the legislative decree, like the one on excise duties, is definitively approved and goes into effect as is, it would not follow the subsequent parliamentary passage foreseen, instead, in which decree laws need to be converted into law.
Therefore, if this were the path taken, in the transformation phase of the raw material, like grapes, to produce really dealcoholized wine, first the agricultural sector, and then the industrial one would have to adapt to a regulation that follows a fiscal logic, instead of having a regulatory system that clearly and pragmatically establishes the production methods and rules first, and consequently, the related taxes to be paid.