With National Bourbon Day recognized on June 14 – and as we like to call it National Kentucky Bourbon Day – we encourage you to responsibly celebrate our signature industry and American’s only native spirit.
It’s also a perfect time to raise a glass to the thousands of Kentuckians the industry employs, the million-plus tourists Bourbon attracts to the commonwealth annually and to the tremendous economic impact the spirits sector makes to our state and local communities.
A study published earlier this year by the Kentucky Distillers’ Association shows our homegrown distilling industry increased 500% the past decade to nearly 100 registered distillers. The industry now provides more than twice the jobs, payroll, capital investment and tax revenue as it did a decade ago.
Further, distilling pours $9 billion each year into Kentucky’s economy and sustains more than 22,500 good-paying jobs with an annual payroll of $1.23 billion.
Kentucky distillers are in the middle of a decade-long $5.2 billion building boom, including $3.3 billion over the next five years. These investments are creating new production facilities, bottling lines, aging warehouses and state-of-the-art tourism centers.
Bourbon tourism makes another significant contribution to our local communities through the KDA’s Kentucky Bourbon Trail® and Kentucky Bourbon Trail Craft Tour® experiences.
Tourists made nearly 1.5 million visits to participating KBT® and KBTCT® distilleries last year – marking a resurgence from the Covid-limited figures of 2020. In fact, the KDA projects 2021 would have been a record year if distilleries had not been closed for Covid , had reduced tour sizes for Covid safety, staffing issues or construction.
Bourbon visitors are elevating tourism across local communities—they are younger than the average Kentucky tourist, have a much higher average household income, travel in packs and stay longer.
A typical KBT® visitor will spend between $400 and $1,200 on lodging, dining, transportation and entertainment, stimulating the local economy and filling local tax coffers.
There’s more Bourbon news to celebrate this month with the lifting of retail tariffs from the United Kingdom coming only days ago. This follows the European Union’s agreement last fall to suspend Bourbon tariffs.
These breakthroughs mean greater opportunities for Kentucky’s spirits producers to export their products, find receptive buyers and cultivate future tourists from overseas.
While we cheer this overwhelming success, Kentucky Bourbon faces challenges at home and around the country.
Kentucky taxes distilling higher than any other industry in the state, putting our legendary brands at a competitive disadvantage and harming our ability to recruit new distillers.
Kentucky is the only place in the world that taxes aging barrels of spirits. This tax, applied during the required aging portion of the Bourbon manufacturing process, discriminates against spirits versus Kentucky’s other major manufacturing industries. It disincentivises further investment in the state and creates a higher barrier to entry for startup distillers, pushing them to competitor states.
And competition from other states is at an all-time high with nearly 4,100 distilleries across all 50 states, up this year by more than 250. Kentucky has now slipped to 12th nationally in its number of distilleries. Make no mistake, those out-of-state distilleries see Kentucky’s sales and tourism as primary targets.
Kentucky’s major advantage—and one that no other state can duplicate—is our rich history and heritage of a proud distilling culture and craftsmanship.
Kentucky Bourbon is built on more than 200 years of unmatched camaraderie and collaboration among distillers, large and small, that makes our industry unique.
By working together through the KDA – and with our tourism, hospitality and legislative partners – we will defend Kentucky’s rightful title as the one, true and authentic home for Bourbon.
And we will continue the momentum that has transformed our treasured industry into a thriving economic and tourism engine for the entire commonwealth.
We hope you will join us June 14 in toasting the success and future of Kentucky Bourbon, and by always savoring our fine spirits responsibly and in moderation.
Eric Gregory is president of the Kentucky Distillers’ Association.
This story was originally published June 13, 2022 11:48 AM.