MN SF4349

Establishes the Minnesota Grape and Wine Advisory Council with 15 voting members including wine producers, grape growers, and representatives from industry associations to review grant applications for Minnesota wine promotion, education, and development.

Creates the Minnesota Grape and Wine Program and Account in the agricultural fund, allowing the commissioner of agriculture to award grants up to three years for promotion, education, development of Minnesota wines, vineyard grower grants, and viticultural/enological extension agents.

Imposes 2.5 percent gross receipts tax on liquor retailers and direct shippers, with a portion of direct shipper wine tax revenues deposited monthly into the grape and wine account starting August 1, 2020.

Requires wineries to obtain a direct shipper license to ship wine directly to Minnesota consumers, limiting shipments to two cases per year containing maximum nine liters per case, and mandates quarterly reporting of shipment details and taxes collected.

Extends sales and use tax nexus to direct shippers and establishes penalties including cease and desist orders, misdemeanor charges for repeat violations within two years, and gross misdemeanor charges for third or subsequent violations.