Bubble Tax Modernization Act of 2025

This legislative proposal seeks to modernize the tax structure for certain alcoholic beverages by removing the differentiation between mead and low alcohol by volume wine under the Internal Revenue Code of 1986. The primary goal is to ensure that these products are taxed similarly, streamlining regulations for producers. The bill achieves this by amending Section 5041(h) to redefine "low alcohol by volume wine" as still wines containing not more than 16 percent of alcohol by volume . More specifically, this definition applies to wines with less than 8.5 percent alcohol by volume and a limited carbon dioxide content. These changes are slated to take effect for wine removed after December 31, 2025.