Lawsuit Challenges Board of Equalization's Authority to Raise Taxes More than 1600% NORWALK, Conn., June 16
NORWALK, Conn., June 16 /PRNewswire/ -- Diageo-Guinness USA, a division of
Diageo, the worlds leading spirits, wine and beer company, and the Flavored
Malt Beverage Coalition filed suit yesterday against California's Board of
Equalization (BOE) challenging regulations that will reclassify flavored beer
-- which is malt based -- as a distilled spirit, increasing the taxes on these
products by more than 1600 percent.
The complaint seeks to invalidate the BOE regulations as illegal on a
number of grounds, including that the BOE does not have the authority to
classify alcohol beverages for taxation purposes and that flavored beer is
beer, not distilled spirits, as a matter of law, and has been taxed as beer by
the BOE for decades.
"The Board of Equalization has the authority to tax within existing
classifications, but it does not have the authority to reclassify alcohol
beverages for the purpose of taxation. The power to reclassify lies solely
with the Department of Alcohol Beverage Control," said Kellye Walker, General
Counsel, Diageo North America. "The BOE has completely overstepped its
jurisdiction," Walker said today.
The complaint was filed in California Superior Court in Sacramento County.
About Diageo
Diageo (Dee-AH-Gee-O) is the world's leading premium drinks business with
an outstanding collection of beverage alcohol brands across spirits, wines,
and beer categories. These brands include Johnnie Walker, Guinness, Smirnoff,
J&B, Baileys, Cuervo, Tanqueray, Captain Morgan, Crown Royal, Beaulieu
Vineyard and Sterling Vineyards wines.
Diageo is a global company, trading in more than 180 countries around the
world. The company is listed on both the New York Stock Exchange (DEO) and the
London Stock Exchange (DGE). For more information about Diageo, its people,
brands, and performance, visit us at http://www.diageo.com/ .
Celebrating life, every day, everywhere, responsibly.
SOURCE Diageo
