HI HB1371

Creates a new definition for "low alcohol by volume spirits beverage" as any alcoholic beverage containing distilled spirits with not more than 10% alcohol by volume

Establishes a new tax rate of $1.10 per wine gallon for low alcohol by volume spirits beverages, significantly lower than the $5.98 per wine gallon rate for distilled spirits

Addresses the current tax inequity where beverages containing any distilled spirits are taxed at the full spirits rate regardless of actual alcohol content

Aims to encourage local Hawaii distilleries to produce ready-to-drink cocktails by reducing the tax burden on low-alcohol products

Takes effect June 30, 2025, with the new tax rate applying beginning July 1, 2025