‘Unless You Get Everything, Shut It Down!’: How a Government Shutdown Affects the Alcohol Industry

(Photo: AP Photo/J. David Ake)

A government shutdown is looming as the House remains divided. Once again, House Speaker Kevin McCarthy appears unable to wrangle the Republican party into a unified front. In January of this year, it took McCarthy 15 tries to finally be voted in as speaker. If he can’t get the votes to raise the debt ceiling and avoid a government shutdown, it can have severe consequences for the alcohol industry. 

One of the federal agencies that will be affected by the shutdown is the Alcohol and Tobacco Tax and Trade Bureau (TTB). While the TTB will continue to provide certain essential services, the processing of formula approvals, permit applications, or Certificate of Label Approval (COLA) applications will halt. These services are essential for businesses to release their products and a shutdown could cause serious delays for spirits that were planned to enter the market. 

The current label processing times are 7 days for distilled spirits labels, according to the TTB. For companies planning to submit applications in the fall, it might be worth getting those in early in case the current stalemate results in an extended shutdown. The ramifications of an extended governmental shutdown don’t just affect big industry in alcohol but also smaller producers seeking their start with new releases or label changes. Timeliness is important, especially for those who have yet to introduce their products to the market. 

A long shutdown could be on the horizon now that Donald Trump has voiced his support to “shut it down.” And congresspeople eager to please the former president may take this opportunity to impress. 

“The Republicans lost big on Debt Ceiling, got NOTHING, and now are worried that they will be BLAMED for the Budget Shutdown. Wrong!!! Whoever is President will be blamed, in this case, Crooked (as Hell!) Joe Biden! Our Country is being systematically destroyed by the Radical Left Marxists, Fascists and Thugs – THE DEMOCRATS. UNLESS YOU GET EVERYTHING, SHUT IT DOWN!,”  wrote Trump in a post on his social media platform, Truth Social. 

The deadline to fund the government is Sept. 30 which doesn’t leave much time for Washington to come to an agreement. A continuing resolution may be passed to extend the deadlines and keep the government running for the time being. However, far-right lawmakers have threatened to block this to force the shutdown unless Democrats make major compromises. They will likely be emboldened by Trump’s support. Although, the alcohol industry could apply some pressure on politicians to help avoid a shutdown. Otherwise, an extended government shutdown could negatively impact the release of new spirits and hurt the alcohol industry.

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