§ 132.140

132.140 Assessment of distilled spirits by department -- Maximum tax rate on distilled spirits in barrels located in bonded warehouse or premises -- Failure to report. (1) The department shall fix the value of the distilled spirits for the purpose of tax ation, assess the same at its fair cash value, estimated at the price it would bring at a fair voluntary sale, calculate the exempt portion of the property taxes, and keep a record of the valuations and assessments. The department shall immediately notify the owner or proprietor of the bonded warehouse or premises of the amount fixed, including the portion of the property tax exemption as calculated in subsection (3) of this section. (2) (a) For purposes of this subsection only: 1. 'Premises' means a bonded warehouse containing distilled spirits: a. The costs of which are financed by one (1) or more series of industrial bonds under KRS Chapter 103 issued prior to January 1, 2024; and b. Any portion of the costs of which remains financed by those bonds during any portion of the calendar year; and 2. 'Taxpayer' means the owner, proprietor, or custodian of one (1) or more premises.

b. Any portion of the costs of which remains financed by those bonds during any portion of the calendar year; and 2. 'Taxpayer' means the owner, proprietor, or custodian of one (1) or more premises. (b) Notwithstanding subsection (3) of this section, the state and local tax rate that may be levied on distilled spirits for a taxpa yer of a premises shall be the state and local tax rate for tax assessments made on January 1, 2023. (c) Distilled spirits stored or aging in barrels located in a bonded warehouse or premises shall be exempt from state and local ad valorem taxes for tax assessments made on or after January 1, 2043. (3) The maximum state and local tax rate that may be levied o n distilled spirits stored or aging in barrels located in a bonded warehouse or premises shall be as follows: (a) Ninety -six percent (96%) of the otherwise applicable tax rate for tax assessments made on January 1, 2026; (b) Ninety -two percent (92%) of the otherwise applicable tax rate for tax assessments made on January 1, 2027; (c) Eighty -eight percent (88%) of the otherwise applicable tax rate for tax assessments made on January 1, 2028; (d) Eighty -four percent (84%) of the otherwise

assessments made on January 1, 2027; (c) Eighty -eight percent (88%) of the otherwise applicable tax rate for tax assessments made on January 1, 2028; (d) Eighty -four percent (84%) of the otherwise applicable tax rate for tax assessments made on January 1, 2029; (e) Eighty percent (80%) of the otherwise applicable tax rate for tax assessments made on January 1, 2030; (f) Seventy -six percent (76%) of the otherwise applicable tax rate for tax assessments made on January 1 , 2031; (g) Seventy -two percent (72%) of the otherwise applicable tax rate for tax assessments made on January 1, 2032; (h) Sixty -eight percent (68%) of the otherwise applicable tax rate for tax assessments made on January 1, 2033; (i) Sixty -one percent (6 1%) of the otherwise applicable tax rate for tax assessments made on January 1, 2034; (j) Fifty -four percent (54%) of the otherwise applicable tax rate for tax assessments made on January 1, 2035; (k) Forty -four percent (44%) of the otherwise applicable ta x rate for tax assessments made on January 1, 2036; (l) Thirty -eight percent (38%) of the otherwise applicable tax rate for tax assessments made on January 1, 2037; (m) Thirty -two percent (32%) of the

ate for tax assessments made on January 1, 2036; (l) Thirty -eight percent (38%) of the otherwise applicable tax rate for tax assessments made on January 1, 2037; (m) Thirty -two percent (32%) of the otherwise applicable tax rate for tax assessments made on January 1, 2038; (n) Twenty -four percent (24%) of the otherwise applicable tax rate for tax assessments made on January 1, 2039; (o) Twenty percent (20%) of the otherwise applicable tax rate for tax assessments made on January 1, 2040; (p) Fifteen perce nt (15%) of the otherwise applicable tax rate for tax assessments made on January 1, 2041; and (q) Eight percent (8%) of the otherwise applicable tax rate for tax assessments made on January 1, 2042. (4) Distilled spirits stored or aging in barrels located in a bonded warehouse or premises shall be exempt from state and local ad valorem taxes for tax assessments made on or after January 1, 2043. (5) If any owner, proprietor, or custodian of a bonded warehouse or premises fails to make the report required by KRS 132.130, the department shall ascertain the necessary facts required to be reported.

If any owner, proprietor, or custodian of a bonded warehouse or premises fails to make the report required by KRS 132.130, the department shall ascertain the necessary facts required to be reported. For that purpose the department shall have access to the records of the owner, proprietor, or custodian; and the assessment shall be made and taxes collected thereon, with interest and penalties, as though regularly reported. (6) The assessment made under (1) of this section shall be reviewed according to KRS 131.110. Effective: March 31, 2023 History: Amended 2023 Ky. Acts ch. 148, sec. 1, effective March 31, 2023. -- Amended 2005 Ky. Acts ch. 85, sec. 179, effective June 20, 2005. -- Repealed and reenacted 1990 Ky. Acts ch. 476, Pt.V, sec. 317, effective July 13, 1990. -- Amended 1966 Ky. Acts ch. 254, sec. 2. -- Amended 1964 Ky. Acts ch. 141, sec. 33. -- Recodified 1 942 Ky. Acts ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 4106, 4107, 4113. Legislative Research Commission Note (3/31/2023). 2023 Ky. Acts ch. 148, sec. 12, reads as follows: 'Any settlement agreement between the Department of Revenue and any taxpayer having distilled spirits in a bonding warehouse,

ssion Note (3/31/2023). 2023 Ky. Acts ch. 148, sec. 12, reads as follows: 'Any settlement agreement between the Department of Revenue and any taxpayer having distilled spirits in a bonding warehouse, which is related to the ongoing assessment or collection of tax under Section 1 of this Act [this statute], shall not be considered null and void based upon the statutory changes in this Act but may be renegotiated by the parties to the settlement agreement and the renegotiated agreement shall be promulgated in an administrative regulation following the renegotiation process.'